The PRIMARY objective of a risk management program is to:
A . minimize inherent risk.
B . eliminate business risk.
C . implement effective controls.
D . minimize residual risk.
Answer: D
Explanation:
The goal of a risk management program is to ensure that residual risk remains within manageable levels. Management of risk does not always require the removal of inherent risk nor is this always possible. A possible benefit of good risk management is to reduce insurance premiums, but this is not its primary intention. Effective controls are naturally a clear objective of a risk management program, but with the choices given, choice C is an incomplete answer.