Michigan Property & Casualty Practice Exam

Negligence is the correct answer, as it does not represent a method of risk management. Instead, negligence refers to a failure to take reasonable care to prevent harm to oneself or others, often resulting in liability in legal terms. It signifies a lack of action or oversight rather than a proactive approach to managing or mitigating risks.

In contrast, the other options are standard methods of handling risk. Sharing involves distributing the risk among multiple parties, which can minimize the impact on any single entity. Avoidance means taking steps to completely eliminate exposure to a particular risk, effectively eliminating the possibility of loss. Transfer typically involves shifting the risk to another party, often through insurance, thereby protecting oneself from potential financial loss. Each of these methods is designed to address risk in a structured and intentional manner, while negligence does not fit within this framework.