Self-insurance as a formula for risk management – a new perspective

Abstract

The article sets together some formulas for risk management that are used to protect company’s operations: mutual insurance, co-operatives, captive insurance, peer to peer, risk retention schemes as well as internal risk distributions. The aim of the article is to recognize how mutual companies and captives differ in risk management, especially what are their stronger and weaker sides in this regards. The analysis has been enriched by comparison of captive and mutual insurance company vs. formula of joint stock insurance company. The results of these considerations present some possible reasons as to why and how, after a long period of demutualization that took place on many insurance markets world wide, there has been recently a significant growth of self-insurance formulas, both mutual insurance and captive. Also the Polish market has been used as an example to portray the changes during the last 15-years period.