What risk management strategy involves taking on some of the risk while obtaining coverage for the excess?

The strategy of taking on some of the risk while obtaining coverage for the excess is known as risk retention. This approach allows an entity or individual to accept certain risks up to a defined limit, while simultaneously seeking insurance or other means to cover any losses that exceed that limit.

By retaining some risk, organizations can often lower their insurance premiums, as they are not seeking coverage for lower amounts that they are willing to handle themselves. This is commonly seen in business practices where companies retain a portion of potential losses as part of their risk management plan, particularly when those losses are predictable and manageable.

This method encourages a more proactive approach to risk management, as it compels the organization to be vigilant in managing their retained risks effectively to avoid losses that could lead to financial strain.