A captive is an insurance company that has as its primary purpose the financing of the risks of its...
risk financing
Risk financing refers to achievement of the least-cost coverage of an organization's loss exposures, while ensuring post-loss financial resource availability.
Additional Information
The risk financing process consists of five steps: identifying and analyzing exposures, analyzing alternative risk financing techniques, selecting the best risk financing technique(s), implementing the selected technique(s), and monitoring the selected technique(s). Risk financing programs can involve insurance rating plans, such as retrospective rating, self-insurance programs, or captive insurers.
Related Terms
The deductible is the amount the insurer will deduct from the loss before paying up to its policy...
Risk management is the practice of identifying and analyzing loss exposures and taking steps to...
Risk management techniques are the methods for treating risks.
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A self-insurance pool is a legal entity regulated by the states that allows unrelated insureds to...
Self-insured retention is a dollar amount specified in a liability insurance policy that must be...
