What risk management practice is the insurance company using by charging Jared a higher premium due to his poor driving record?

The insurance company is implementing a form of risk management known as risk transference by charging Jared a higher premium due to his poor driving record. In this scenario, the insurance company is transferring part of the financial risk associated with insuring Jared from itself to him. By raising Jared's premium, the insurer acknowledges his higher likelihood of filing a claim based on his driving history, thus shifting the potential costs of loss onto him in the form of increased premiums.

Risk retention involves accepting the risk and managing it internally, which isn't the case here since the insurer is adjusting costs based on the perceived risk. Risk avoidance would mean completely eliminating the risk, which could involve the insurance company refusing to insure Jared altogether, rather than insuring him at a higher cost. Risk reduction involves taking steps to reduce the likelihood or severity of a loss, such as offering discounts for safe driving, which does not apply in this situation since the focus is on increasing the premium due to existing risk factors.