You recently met with your client, Don, age 40.

Don is widowed and has one dependent child. During your meeting with him you discussed the concept of risk management. Which of the following statements regarding the ways to manage risk is incorrect?

a. The selling of Don's Jet Ski is an example of risk reduction.

b. Not purchasing life insurance is an example of risk retention.

c. Purchasing a warranty is an example of risk transfer.

d. Insurance is not necessary for every risk of financial loss.