Since everyone has risk, the need to handle risk is universal. In various time and places, people have developed a variety of methods for meeting this need. You can remember these methods with the acronym, STARR:
- Sharing — Giving and receiving help within your community
- Transfer — Getting insurance
- Avoidance — Refraining from doing an activity or doing something that may come with a risk
- Reduction — Taking care to lessen the likelihood of incurring a loss
- Retention — Keeping the consequences of incurring a loss upon yourself
The next slides will explain each one in more detail.