Answer to Question #109624 in Management for Tonny Twum Acheampong

Question

Contractual arrangements that transfer risk include: leases and rental agreements, hold- harmless clauses and surety bounds. But which is the most common financial technical used by individuals and organization to transfer risk?

Answer 1

The most common economic technical used by individuals and organizations to transfer risk is insurance. When an individual or entity buys insurance, they are protected against commercial threats. However, the risk transference is a standard risk management method where different outcome potential encountered by an individual or entity is transferred to the third party.