Which method represents a proactive approach to financing risks?

Self-insurance is viewed as a proactive approach to financing risks because it involves setting aside funds to cover potential losses rather than transferring that risk to an insurance company or relying on external funding sources. This strategy allows an organization to have control over their risk management process, as they determine the amount and the manner in which the funds are allocated.

By creating a self-insurance fund, a business anticipates potential liabilities and expenses, effectively preparing to handle these risks internally when they arise. This proactive stance not only helps manage financial stability but can also lead to cost savings over time, as it avoids the premiums associated with traditional insurance policies.

In contrast, the other options represent more reactive or indirect methods of managing risk. Risk transfer to third parties typically involves purchasing insurance, which essentially shifts the burden of risk to another entity rather than proactively managing it. Funding through public investment and bank loans does not inherently address risk financing; these methods primarily provide capital without necessarily planning for risk exposure. Thus, self-insurance stands out as a proactive strategy designed to anticipate and finance risks effectively.