Which of the following is an example of “going bare”? A) Enrique owns

QUESTION

Which of the following is an example of “going bare”?

A) Enrique owns a small recording studio. Despite its size, the studio contains thousands of dollars’ worth of equipment. Enrique has chosen to transfer his risk.
B) Hetty owns a small nail salon and the building it is in. Because she perceives the risks in her industry to be minimal, Hetty does not carry any liability insurance. She has chosen to carry only fire insurance.
C) Maxwell owns a small hair salon. He rents the space and doesn’t need much equipment or many supplies, so he does not carry insurance.
D) Bart is a professional glassblower with his own studio. Because of the risk of fire and risk of injury working around hot glass and metal, Bart is insured to the hilt.
E) Mary owns and operates a horse-breeding business. Because the land, the barns, and the horses are so valuable, Mary has as much insurance as her budget will allow.

ANSWER

Answer: C
Explanation: C) A company may carry no insurance at all, known as “going bare.”