A company purchased insurance due to the risks involved with a cloud migration project. Which of the following risk response strategies is this an example of?

The correct answer is D. Transference. Transference is a risk response strategy that involves shifting the responsibility or impact of a risk to a third party, such as an insurance company, a vendor, or a partner. By purchasing insurance, the company transferred the financial liability of the cloud migration project…

Business Principles of Cloud

Question

Options

AMitigation
BAvoidance
CAcceptance
DTransference

How the community answered

(33 responses)

A
3% (1)
B
3% (1)
C
9% (3)
D
85% (28)

Explanation

Transference is a risk response strategy that involves shifting the responsibility or impact of a risk to a third party, such as an insurance company, a vendor, or a partner. By purchasing insurance, the company transferred the financial liability of the cloud migration project to the insurance provider, in case of any losses or damages. Transference does not eliminate the risk, but it reduces the exposure of the company to the risk.

Topics

#risk transference#risk response strategies#cloud insurance#risk management

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