Every individual engages in some form of risk retention as a way of protecting yourself in an event of a loss. Two examples of risk retention are homeowners insurance and health insurance. My family chooses to pay a higher premium when it comes to homeowners insurance so an event were to occur, the deductible would be less. Health insurance is also a form of risk retention. I have to pay a certain amount of money out of pocket before my insurance will pay the rest. This is often the reason why individuals are opting to pay the penalty instead of purchasing insurance because it is less
