Installing an automatic sprinkler system is an example of which risk management technique?

Installing an automatic sprinkler system is an effective example of risk reduction because it actively lowers the potential severity of fire damage. Risk reduction involves implementing measures that mitigate the impact or severity of a loss rather than eliminating it entirely. In this case, the sprinkler system works to control or extinguish a fire, which decreases the likelihood of significant property damage or personal injury.

By enhancing safety measures within a property through the installation of such systems, property owners proactively address the risk associated with fire hazards. This preventative approach aligns with risk reduction principles, as it diminishes the overall risk profile without attempting to evade the risk altogether or shift it to another party.