Employee benefit trusts represent the largest global form of self-insurance. In the USA over 50% of large corporations use these vehicles to self-fund their employee benefits. Profits are retained by the trust and insurance is normally purchased to protect a trust from large as well as unexpected aggregate losses.Read More
A captive is an insurance company that is capitalised and wholly owned by one or more non-insurance companies to insure the risks of its owners. Rent-a-captives allow smaller businesses to rent the capital of a captive to enable them to receive the benefits of using a captive at a lower cost.Read More
Although not traditionally classed as self-insurance, program business involves an intermediary acting as its own insurance company. This is achieved through a delegated authority from an established insurance company which allows the intermediary to market and sell policies under its own brand without referring them to the insurer.Read More
A Risk Retention Group (RRG) is an insurance company as permitted by the Federal Liability Risk Retention Act. A RRG must form as liability insurance company and must be domiciled onshore under the laws of one state. RRG’s are permitted to accept all forms of liability risks from their owners with the exception of workers compensation.Read More
In addition to employee benefit trusts, liability insurance risks that meet certain size criteria can be partially self-insured though a high excess known as a self-insured retention or SIR. The introduction of a self-insurance retention introduces many of the features of self-insurance which involve a company acting as its own insurance company but with losses capped at a defined amount.Read More
A mutual insurance company is an insurance company which is owned entirely by its policyholders as opposed to outside investors. Any profits earned can either be returned to policyholders in the form of dividends or as reduced future premiums.
It is estimated that over 6,000 corporations in the USA elect to self-insure their Workers' Compensation plans. Self-insuring allows companies to control costs and helps to ensure that their injured workers are receiving cost-effective and appropriate care.Read More