risk transfer

Definition

Shifting risk from one party to another; examples include purchasing insurance coverage or issuing debt.

Use risk transfer in a sentence

When your house floods or gets hit by a tornado, your risk transfer would pay for the damages instead of you

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Jean and Sally agreed that purchasing the coverage for their new bakery was a great risk transfer strategy for the money it cost.

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By partnering with another company we were able to do a risk transfer as they would be underwriting the construction on the new building.

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risk tolerance transfer