Final answer:
The question asks for the correct term that completes a statement about managing financial loss through insurance or contracts. The answer is 'Risk transfer', as it signifies the shift of risk from one party to another, primarily through insurance. The correct option is d.
Step-by-step explanation:
The content loaded question asks about the strategy used to manage potential financial loss by shifting the risk to another party. This is done through buying insurance or by contractual means. So, the complete statement is: Risk transfer is accomplished largely through buying insurance but can be achieved by making contractual arrangements that transfer risk to others.
Insurance itself is a method for protecting an individual from financial loss. It involves policyholders making regular payments to an insurance company. In the event of a financial setback covered by the policy, the insurance firm compensates the affected group member. This practice exemplifies risk sharing and provides a safety net against certain events, reducing the need for individuals to guard against those risks, a phenomenon known as moral hazard.
Therefore, the correct answer to fill in the blank is 'd. transfer', highlighting the concept of risk management in business and finance.