PRINCE2-PRACTITIONER Practices Practice Question
A project manager is evaluating a risk with a high probability and severe negative impact on the project schedule. The organization decides to take out a specialized completion guarantee insurance policy with a third party. Which risk response is being applied?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Transfer
Shifting the financial impact or consequence of a risk to a third party is 'Transfer'.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Avoid
Why it's wrong here
Avoidance eliminates the risk by cancelling the risky activity.
- ✓
Transfer
Why this is correct
Insurance is a classic risk transfer mechanism.
- ✗
Mitigate
Why it's wrong here
Mitigation alters probability or impact internally; transferring shifts the impact to an external party.
- ✗
Accept
Why it's wrong here
Acceptance means no proactive risk response is taken.
About these practice questions
Courseiva writes every PRINCE2-PRACTITIONER question from scratch — 297 in total, each with an explanation and a wrong-answer breakdown. None are copied from real exams or dumps. Learn why practice questions differ from exam dumps →
JA
Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed August 2026 · checked against the official AXELOS / PeopleCert exam blueprint
This PRINCE2-PRACTITIONER practice question is part of Courseiva's free AXELOS / PeopleCert certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the PRINCE2-PRACTITIONER exam.