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Risk Financing

By: Steven T. Bird, CPCU
Risk Financing

The cost of IRMI application products depends on the size of your organization. The size ranges are as follows.

  • 1-9 Employees
  • 10-30 Employees
  • 31-60 Employees
  • 60+ Employees - Contact us for a quote!

To subscribe to an IRMI product, you can purchase either a single-seat license for an individual, or an unlimited group license for everyone in your organization. The cost depends on whether your firm qualifies as a "Small Business" or a "Large Business" under the definitions in the following table.

Item Individual Small Business Large Business
Users 1 Unlimited Unlimited
Agency/Brokerage Any size Under $10M Revenue $10M+ Revenue
Insurance Company Any size Under $100M Premium $100M+ Premium
Law Firm Any Size Under 10 coverage Lawyers 10+ Coverage Lawyers
Risk Mgmt. Dept. Any Size Any Size N/A
Other Organization Any Size Under 100 Employees 100+ Employees

All IRMI subscriptions are annual. Most subscriptions offer two ways to pay.

  1. Monthly: The full annual cost is broken out over 12 monthly installments that are billed to your credit card each month.
  2. Annual: Get 5% off the full annual cost if you choose a single payment billed to your credit card once per year.

Note that the monthly payment option and the subsequent 5% discount for annual payments are not available on some products.  

Risk Financing

Product type: 1 Year Subscription

Publication Date(s): 1983-2016

Update Schedule: Quarterly

Part of: Risk and Insurance Package

Discount: Prices shown include a 5% discount for choosing the annual payments option


Summary

Easy-to-use-and-understand reference explaining the various funding options for your organization’s risks. Excellent resource for state-specific regulations.

Risk Financing is an easy-to-use-and-understand reference explaining the various risk finance options for any organization's liability and workers compensation risks. It covers all the alternatives with cutting-edge analyses and explanations of traditional insurance rating plans and alternative market options. This includes experience rating, dividend plans, retrospective rating, deductible plans, self-insurance, pooling arrangements, risk retention groups, captive insurance, fronting, reinsurance, and even risk securitization. It is the best online resource available for state-specific regulations.

Risk Financing lays out all the steps necessary to perform a systematic evaluation of risk finance options from loss forecasting to net present value analysis of the alternatives. It includes many useful factors and formulas to help, including loss development factors and claims cost (Masterson) indexes, which are updated annually. Because we keep it current for you, it can eliminate any uncertainty you may feel about which of the many alternative plans is best for your organization or client. It will also provide invaluable insight for fine-tuning any existing program.

Risk Financing covers these topics and more!

  • Risk Quantification
  • Basic Loss Forecasting Methods
  • Measuring Loss Development
  • Risk Assessment Using Probability and Statistics
  • Risk Retention
  • Maximum Possible Loss and Probable Maximum Loss
  • Cost of Capital and the Time Value of Money
  • Loss Sensitive Insurance Plans
  • Retrospective Premium Factors
  • The Alternative Market
  • Basics of Reinsurance
  • Tax and Accounting Implications of Risk Financing
  • Plan Evaluation
  • General Liability and Auto Liability Loss Development Factors
  • Workers Compensation Loss Development Factors
  • Includes Newsletter: Risk Finance Perspectives

Risk Financing TOC

Agents, Brokers, and Account Support Staff

  • Evaluate and improve the programs currently used by your clients.
  • Equip yourself to point out the disadvantages of self-insurance pools, group captives, and other alternative markets that may not be the best choices for your clients.
  • Keep up with developments in the alternative market, compare plans, and choose the most cost-efficient option for your insureds.
  • Forecast future losses so you can make apples-to-apples comparisons of your insureds' options.
  • Help your clients study the feasibility of self-insurance or a captive.
  • Point out tax and accounting issues with risk finance options that your clients should address with their accountants.
  • Help your clients prepare a request for proposal (RFP) to select the best possible third-party administrator (TPA).

Risk Managers, Financial Executives, & Insurance Buyers

  • Evaluate and improve the programs currently used by your company.
  • Keep up with developments in the alternative market, compare plans, and choose the most cost-efficient option.
  • Forecast future losses with confidence to enable apples-to-apples comparisons of your options.
  • Study the feasibility of self-insurance or a captive.
  • Understand the advice you get from brokers, consultants, accountants, and actuaries.
  • Speak knowledgeably with your accountants about the tax and accounting implications of your alternative risk finance options.
  • Prepare an RFP that will help you select the best possible TPA.

Underwriters

  • Evaluate and advise on improvements to the programs currently used by your clients.
  • Benchmark your internal loss development factors (LDFs) against the annually updated industry LDFs.
  • Employ the Masterson Indexes in your loss forecasting model.
  • Keep up with developments in the alternative market, compare plans, and advise agents/brokers and insureds on the most cost-efficient option.
  • Understand how tax and accounting practices may affect the acceptability of your proposed programs.

Consultants

  • Evaluate and advise on improvements to the programs currently used by your clients.
  • Use the annually updated LDFs and Masterson Indexes in your loss forecasting models.
  • Keep up with developments in the alternative market, compare plans, and advise clients on the most cost-efficient option.
  • Study the feasibility of self-insurance or a captive.
  • Properly consider the tax and accounting implications of the alternative risk finance programs you recommend.
    Bonus Publication Icon

    Your purchase of Risk Financing includes access to Contractor's Guide to OCIPs, a handy reference that provides guidance on 39 issues contractors should consider when accepting coverage through a wrap-up or controlled insurance program. This publication was prepared by the OCIP Task Force of the AGC of America.

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