What does self-insurance mean?

Definitions for self-insurance
self-in·sur·ance

This dictionary definitions page includes all the possible meanings, example usage and translations of the word self-insurance.

Princeton's WordNet

  1. self-insurancenoun

    insuring yourself by setting aside money to cover possible losses rather than by purchasing an insurance policy

ChatGPT

  1. self-insurance

    Self-insurance is a risk management method in which an individual, business or organization sets aside funds to be used to remedy an unexpected loss, instead of purchasing an insurance policy from an insurance company. It involves bearing one's own risk rather than transferring it to an insurer, and is often used by large companies that can afford to handle minor losses in-house.

Wikidata

  1. Self-insurance

    Self-insurance is a risk management method in which a calculated amount of money is set aside to compensate for the potential future loss. If self-insurance is approached as a serious risk management technique, money is set aside using actuarial and insurance information and the law of large numbers so that the amount set aside is enough to cover the future uncertain loss. Self-insurance is possible for any insurable risk, meaning a risk that is predictable and measurable enough in the aggregate to be able to estimate the amount that needs to be set aside to pay for future uncertain losses. For a risk to be insurable, it must represent a future, uncertain event over which the insured has no control. Other characteristics which assist in making a risk self-insurable include the ability to price or rate the risk. If the insurable event is one in a large number of similar risks, the aggregate risk can be estimated according to the law of large numbers and the probability of that event occurring in the future can be quantified. Normally, catastrophic risks are not self-insured as they are highly unpredictable and high in loss-value. Catastrophic risks are normally underwritten by the re-insurance or wholesale insurance market. Any risk where the potential loss is so large that no one could afford to pay the market premium required to provide cover would not be commercially insurable. An example is that earthquakes cannot be fully insured against because an earthquake can cause more damage than any insurer or the combined insurance market is willing to risk in total assets. However, captives and self-insurance programs are often designed to provide for a part of a risk that would be catastrophic to the business concerned, or catastrophic risks that are often commercially uninsurable, such as tobacco litigation liability risks.

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Numerology

  1. Chaldean Numerology

    The numerical value of self-insurance in Chaldean Numerology is: 5

  2. Pythagorean Numerology

    The numerical value of self-insurance in Pythagorean Numerology is: 2

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"self-insurance." Definitions.net. STANDS4 LLC, 2024. Web. 19 Mar. 2024. <https://www.definitions.net/definition/self-insurance>.

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