Ways of mitigating specific risks: (1) Insuring risk (2) Sharing risk (3) Transferring risk How do these three factors differ from one another? Thanks for helping
Insuring risk is a specific form of risk transfer. If you take out insurance then you are transferring some risk to the insurer, but not all risk transfers involve insurance. For example, the purchase of an annuity transfers an individual's longevity risk to the annuity provider, but this isn't really insurance. Sharing risk with another party might involve more than just risk transfer, for example they could be able to advise on other control measures. For example, home and contents insurance might carry a large excess which means that the individual hasn't completely transferred the risk but they're sharing it with the insurer, and the insurer might provide a home security pack to reduce the risk of theft.
