Which statement about relocation of the risk source is true?

Which statement about relocation of the risk source is true?

• A. It is considered risk transfer.
• B. It relocates the risk within the organization but does not transfer risk to another party.
• C. It eliminates risk.
• D. It reduces all hazard.

Answer: (B)

Relocation of the risk source means moving the hazard from one part of the organization to another location or process that is still under the same ownership. It shifts where the exposure exists, but it does not hand the risk off to an external party. Since the risk remains within the organization, it is not eliminated or transferred to someone else, and it may not automatically reduce all hazards—it's simply a repositioning of where the risk is managed. An example is moving a critical function to a different facility or department with better controls while retaining responsibility for the risk inside the organization. This is why the statement that it relocates the risk within the organization but does not transfer it to another party is the true one.

Relocation of the risk source means moving the hazard from one part of the organization to another location or process that is still under the same ownership. It shifts where the exposure exists, but it does not hand the risk off to an external party. Since the risk remains within the organization, it is not eliminated or transferred to someone else, and it may not automatically reduce all hazards—it's simply a repositioning of where the risk is managed. An example is moving a critical function to a different facility or department with better controls while retaining responsibility for the risk inside the organization. This is why the statement that it relocates the risk within the organization but does not transfer it to another party is the true one.