Insurance is an example of risk mitigation. Here, a risk is taken on by some third party in return for economic compensation. So a car insurance company receives policy premiums from drivers but agrees to pay out to compensate for damage or injury incurred in a covered car accident. In financial markets, credit default swaps (CDS) operate similarly, whereby one financial institution receives premium payments to insure another financial institution against a credit event in some other company or investment. Risk avoidance is another mitigation strategy that tries to prevent being exposed to a risk scenario completely.