What is an insurance fund?
The insurance fund is a collective fund of assets from multiple insurance companies. The association is used as a way of providing high -risk insurance. The companies themselves could not afford the risk of taking high -risk accounts, but by associating their assets with other companies they can afford to extend such coverage and offer a higher level of coverage. Association is a commonly used tactics for management of high risk of insurance. The association process distributes the risk of coverage, with most pools designed to grow over time as the client's list grows, and companies contribute to other means so that the weather can even the greatest demands. As recognition for the services they provide, insurance funds are sometimes offered special incentives of the government, which is advantageous for the pool of assets.
In some cases, the insurance fund is established by a government mandate to create a resource that will allow high riskIkové candidates to obtain insurance. In other cases, the insurance company voluntarily combines its resources. For example, nuclear insurance is provided through insurance association, because no single insurance company is willing to take over the risk of insurance of nuclear equipment. Similarly, many states of health insurance funds that are designed to ensure that people who are considered ineligible for individual coverage still have access to health insurance through an insurance fund.
Insurance Association is often used as a way of providing insurance for people who could not otherwise purchase it. For example, people in California often buy an earthquake insurance via an insurance fund, because home insurance in California can specifically exclude an earthquake of a detailed hazard of politics. The inhabitants of the American South susceptible to Hurricane can also use the association of insurance for access to hurricane and flood insurance because these hazardsTheir owners do not cover these dangers.
Another example of the high -risk insurance fund is the swimming pool created to expand the coverage of the environmental responsibility to industrial manufacturers and manufacturers. Such insurance is required by law in many regions of the world, so if the company causes contamination of the environment, it will be paid. However, this insurance is very risky for the insurance company because the contamination of the environment can be very expensive to clean. For this reason, many companies decide to create an insurance fund to provide such cover.