What do individuals use to transfer their risk of loss to a larger group?

Pooling is the correct answer because it refers to the process through which individuals come together to share the financial risks associated with potential losses. In the context of insurance, pooling allows a large group of individuals to collectively manage the risk of loss by paying premiums into a common fund. This fund is then used to cover the losses experienced by any member of the group who encounters a loss, thereby spreading the financial impact across all members.

The concept of risk pooling is fundamental to the insurance industry, as it enables insurers to provide coverage and protect against uncertainties. By aggregating risks from many different individuals or entities, the overall risk becomes more predictable and manageable, allowing for the calculation of premiums necessary to sustain the insurance operations. This mechanism helps individuals protect themselves against catastrophic financial consequences that could arise from unforeseen events.

Other options like insuring, sharing, and joint liability capture different aspects of risk management but do not specifically refer to the systematic approach of group risk redistribution that pooling entails. Insuring is a broader term that encompasses the act of obtaining coverage, while sharing is a more general concept and lacks the structure provided by pooling. Joint liability pertains to legal obligations shared among parties, which does not align with the specific context of transferring risk within an insurance framework.