ITPEC IP April 2025 Question 44
ITPEC IP April 2025 — Question 44 of 100
Transfer or distribute the risk through an agreement, such as insurance — this is risk sharing.
Insurance does not remove the underlying event, but contractually transfers or shares part of its financial impact with another organization. Outsourcing or contractual allocation can also share particular consequences and responsibilities, although accountability must still be managed.
Answer (c)
Why not others:
- (a) is risk avoidance: stop the risky activity
- (b) is risk mitigation: reduce likelihood or impact through controls
- (d) is risk retention: knowingly accept the residual risk
Key rule: The four treatments are avoid, mitigate, share or transfer, and retain; identify them by what happens to the activity and its remaining impact.
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