The Cost of Risk and the Concept of Risk Partnership

A recent survey in UK has highlighted the large discrepancy between the insured and uninsured costs of losses, demonstrating that the true cost of risk is much higher than previous estimates. Risk is never totally transferred by insurance, and if insureds recognise that they retain a partial ownersh...

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Bibliographic Details
Published inGeneva papers on risk and insurance. Issues and practice Vol. 20; no. 76; pp. 279 - 283
Main Author Reid, John W.
Format Journal Article
LanguageEnglish
Published Association Internationale Pour l'Étude de l'Économie de l'Assurance / International Association for the Study of Insurance Economics 01.07.1995
Subjects
Business insurance
Business risks
Collaboration
Corporate objectives
Employee insurance
Insurance claims
Insurance expenses
Insurance management
Insurance providers
Noninsurable risks
RISK MANAGEMENT ISSUES
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Summary:A recent survey in UK has highlighted the large discrepancy between the insured and uninsured costs of losses, demonstrating that the true cost of risk is much higher than previous estimates. Risk is never totally transferred by insurance, and if insureds recognise that they retain a partial ownership of the risk there is a greater likelihood that there will be better loss control. The paper promotes the concept of "risk partnership" as a more correct representation of the contract between insurer and insured than the more generally used term of "risk transfer".
ISSN:1018-5895
1468-0440