A risk management strategy that shifts the financial consequences of an exposure to a third party, such as through an insurance policy, is called risk _____.

### Why this is right The material names **risk acceptance** as a risk-management option. In ordinary use, acceptance means retaining the exposure rather than choosing to avoid it or transfer its consequences. ### The concept A response to risk is a choice about what to do with an exposure. **Acceptance** keeps the exposure with the decision-maker, who bears its consequences. **Avoidance** removes the activity that creates the exposure. **Transfer** shifts some agreed consequences to another party. The three terms should not be treated as synonyms: each describes a different response. The source lists the terms but does not specify criteria for deciding which one is best in a particular case. ### Terms - **Risk acceptance**: Retaining an exposure and bearing its consequences. - **Risk transfer**: Shifting some agreed consequences to another party. ### Remember A retained exposure is accepted, not avoided.