Risk managers use a number of methods for handling risk. For each of the following, identify the method for handling risk and briefly explain that method.
• The decision not to carry earthquake insurance on a firm’s main manufacturing plant. • The installation of an automatic sprinkler system in a hotel. • The decision not to produce a product that might result in a product liability lawsuit. • Requiring retailers who sell the firm’s product to sign an agreement releasing the firm from liability if the product injures someone. • Purchase a travel insurance for a trip to Philippine that covers all potential medical expense.