self insurance

Dictionary of Business Terms for: self insurance
self insurance

protecting against loss by setting aside one’s own money. This can be done on a mathematical basis by establishing a separate fund into which funds are deposited on a periodic basis. Through self insurance it is possible to protect against highfrequency, low-severity losses.

Dictionary of Insurance Terms for: self insurance
self insurance

protecting against loss by setting aside one’s own money. This can be done on a mathematical basis by establishing a separate fund into which funds are deposited on a periodic basis. Through self insurance it is possible to protect against high- frequency, low-severity losses. To do this through an insurance company would mean having to pay a premium that includes loadings for the company’s general expenses, cost of putting the policy on the books, acquisition expenses, premium taxes, and contingencies.

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