What is typically the main focus of self-insurance?

The main focus of self-insurance is to set aside funds for future losses. This approach involves individuals or organizations retaining their risk instead of transferring it to an insurance company. By creating a reserve of funds, they can cover potential claims or losses as they arise, rather than relying on an insurer to handle those costs. This method allows for greater control over financial risks and can lead to potential savings when compared to traditional insurance approaches, where premiums are paid without assurance of a return on those payments.

In contrast, minimizing all potential risks, while a goal of many risk management strategies, is not the primary focus of self-insurance. Additionally, purchasing multiple insurance policies is often a means of risk transfer, not applicable to self-insurance. Reducing insurance premiums, while a potential benefit of self-insurance, is a secondary consideration rather than the main focus, as the primary intent is to manage risk through financial reserves.