What are your self-insurance options?
Self-insurance is one way businesses can maintain some control over their own risks, while still being able to purchase protection at higher entry levels when needed, through an insurer – at rates much lower than those offered by traditional programmes.
What can self-insurance programmes cover?
Almost any type of traditional insurance can be adopted to a self-insurance programme. The most common are:
- Motor fleet
- Liability
- Property
- Contingency
What are the key 3 areas of self-insurance?
The first step to taking a self-insurance approach is to understand your exposure in the 3 core areas:
– Your present risk management systems
– Your present risk retention
– The structure of your insurance programme
The below graphic demonstrates the 3 key areas. Insurance (risk transfer) is actually a smaller part of the overall hidden management costs.
By retaining more financial risk, adequate risk management controls will need to be in place.
What types of self-insurance are available?
There are 3 main types of self-insurance:
– Higher excess levels
– Aggregate excess
– Captives
Read more here: What is Self-Insurance? – selfinsuranceprotect.co.uk
How do we approach setting up a self-insurance programme?
Retaining more risk, you will be able to control your risk management & claims management processes.
Advantages
– By controlling your risk and increasing your retention levels, you will lower your initial cost of insurance. The more risk you assume, the less you will pay in insurance premiums.
– Managing claims can be more effective.
– Insure in the manner you choose.
– Self-insurance can motivate you to improve your risk management.
Disadvantages
– Investment in process, risk management and claims handling is needed.
– Balance sheets will need to be robust enough to fund smaller losses.
Any questions? Please don’t hesitate to contact one of our team.
Matthew.collins@ascendbrokingold.co.uk | Office: 01245 449061
