Which statement describes risk avoidance?

Which statement describes risk avoidance?

• A. Not owning a car
• B. Purchasing auto insurance
• C. Installing an alarm system
• D. Defensive driving training

Answer: (A)

Risk avoidance means choosing not to engage in the activity that creates the risk, so you eliminate exposure to it altogether. Not owning a car removes the auto risk entirely because you’re not participating in driving, owning, or maintaining a vehicle that could be involved in accidents or theft. The other options reduce or transfer risk rather than avoid it. Purchasing auto insurance transfers some financial risk to the insurer, installing an alarm system reduces the chance or severity of theft, and defensive driving training lowers the likelihood or severity of an accident. None of these options completely eliminates the risk, whereas not owning a car does.

Risk avoidance means choosing not to engage in the activity that creates the risk, so you eliminate exposure to it altogether. Not owning a car removes the auto risk entirely because you’re not participating in driving, owning, or maintaining a vehicle that could be involved in accidents or theft.

The other options reduce or transfer risk rather than avoid it. Purchasing auto insurance transfers some financial risk to the insurer, installing an alarm system reduces the chance or severity of theft, and defensive driving training lowers the likelihood or severity of an accident. None of these options completely eliminates the risk, whereas not owning a car does.