Self-Insurance Feasibility Calculator

Evaluate whether you have sufficient reserves to self-insure certain risks.

Self-insurance means setting aside funds to cover potential losses instead of buying insurance. This calculator evaluates whether you have sufficient reserves and whether the expected savings justify the risk. A general rule suggests having at least 3x the maximum potential loss in liquid assets before considering self-insurance. The tool also compares premium savings against expected losses to estimate net benefit.

Calculator

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Self-Insurance Feasibility
May not be advisable
Asset-to-Loss Ratio
2.0x
Expected Annual Loss
$1,250
Premium Savings
$1,200/yr
Net Annual Benefit
$-50
Years to Accumulate Max Loss
N/A

Common use cases

  • Assumes ability to absorb loss without financial hardship
  • 3x coverage ratio is a conservative guideline
  • Expected loss is probabilistic, not guaranteed
  • Does not account for catastrophic or correlated risks

This tool provides general informational estimates and is not insurance advice or a quote.