by Guest » Tue Feb 09, 2010 10:03 am
A Michigan-based business house owns 36 vehicles and holds net worth above $6 million. Considering it has a good fund limit, would it be possible to get self-insurance for covering the auto risk of such a business?
Posted: Tue Feb 09, 2010 07:13 pm Post Subject:
In the state of Michigan, if you wanted to self-insure your automobile risk the state requires the business to own or operate 25 or more vehicles, possess a net worth of over $5 million, and sets a very high fund limit. In most instances, being self-insured is for large companies, with many employees, vehicles, locations, and net worth.
InsTeacher 8)
Posted: Thu Feb 11, 2010 10:13 am Post Subject:
It's definitely a good way of reducing your current premium costs and achieving control over the smaller risks within the organization. It's more about the business covering itself for certain specified risks. A fund gets created and managed by the business in connection with it's claims.
Posted: Fri Feb 12, 2010 09:03 am Post Subject:
There are certain risks that don't get self-insured without the state approval. Auto liability insurance if mandatory, would need to meet State rules in order to be self-insured. Different risk retention groups could be formed under the Federal regulations.
Posted: Sat Feb 13, 2010 06:02 am Post Subject:
For all large enterprises, it could be a good thing to go for self-insurance as a part of their risk program. What we've to remember over here is that the company is not self-insuring their full risk. It's just a portion of their risk that they're actually covering themselves.
Posted: Mon Feb 15, 2010 11:09 am Post Subject:
Each business categorizes it's risks and analyzes the possibilities of losses arising out of those risks. At the same time, all businesses estimate a maximum worth of loss that it can withstand under a particular loss category. This amount is called the self-insured retention limit for the business.
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