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sasha
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Joined: 27 Mar 2006
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 Posted: Fri Apr 28, 2006 11:19 am Post subject: A brief about Self-Insurance
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Self Insurance is a form of Risk management that enables an organization to insure a part of their risk and thereby keep its risk cost at bay. In doing so, potential future losses could be ascertained and it improves coverages and limits, enhances claims management and loss control and gains cash flow advantages. Thus the amount for covering this ascertained loss can be calculated by using the vital information provided by the actuaries and insurance professionals. Although Self-insurance is quite like that the other forms of insurance but there are no premiums to be paid to the insurer.
Therefore the entire concept of Self-insurance revolves around the process of retaining eligible risks, calculating risks, paying the resulting claims and losses. There are no Self-insurance available for individuals since they have little money to cover a huge loss that may arise in the future. Its also not possible for them to ascertain the true measure of the forthcoming loss since they don't have enough risk exposures to disperse the risk. Hence the individuals won't have any other options left than buying an insurance or retaining the risk. |
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