Which of the following best describes self-insurance?
1. actively setting aside money to fund any losses should that occur.
2. using precautionary savings to purchase insurance.
3. diversifying activities to minimize risk.
4. all of the above are descriptions of self-insurance.

Actively setting aside money to fund any losses should that occur

Explanation:

Self-insure a hazard is the board method wherein an organization or individual puts aside a pool of cash to be utilized to cure a surprising misfortune. Hypothetically, one can self-guarantee against an accident. Practically speaking, in any case, the vast majority buy protection against possibly huge, rare adversities.

Self-insure against specific misfortunes might be more practical than purchasing protection from an outsider. The more unsurprising and littler the accident is, the almost certain it is that an individual or firm will decide to Self-insure.