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Self Insuring - The Ins and Outs of Self-Insuring Your Property

Self Insuring - The Ins and Outs of Self-Insuring Your Property

The Ins and Outs of Self-Insuring Your Property

Insurance for your property—be it your home, car, or valuable possessions—is like a financial cushion for those unpredictable life moments. But have you ever considered being your own insurance provider? It might sound daring, but the idea of self-insuring property is not as far-fetched as it might initially appear. This blog post delves into what self-insuring means specifically for property coverage, and the pros and cons of this approach.

What Is Self-Insuring?

Simply put, self-insuring means that instead of paying premiums to an insurance company, you set aside money for emergencies. In this setup, you are essentially your own insurance provider. If a disaster strikes—say, a flood damages your basement—you would cover the costs yourself from the savings you've put aside for this very purpose.  Many Commercial Property Owners in Johnson City are now considering this option.

The Benefits of Self-Insuring Your Property


One of the most significant advantages of self-insuring is flexibility. You decide what needs coverage and to what extent, without being confined to an insurance company's terms and conditions.

Potential Cost Savings

Insurance premiums can add up over the years. When you self-insure, and life happens to be on your side, you could potentially save a considerable amount of money.

No Denied Claims

With no insurance company involved, you don't have to worry about your claim being denied. You make the decisions on what to cover, so there's less red tape to deal with.

The Risks of Self-Insuring Your Property

Financial Exposure

The primary risk of self-insuring is that you must have enough funds to cover a significant loss. For instance, if a natural disaster damages your home extensively, you'll need a substantial sum to repair or replace it.

Planning and Discipline

Self-insuring requires a high level of financial planning and discipline. You need to consistently put aside money and refrain from using these funds for anything other than emergencies.

Emotional Strain

Handling a loss is emotionally draining, and managing the financial aspects at the same time can add to your stress. Traditional insurance provides a layer of emotional security that self-insuring might lack.

Steps to Successfully Self-Insure Your Property

Assess Your Risks

Take stock of your property and assess its value. Calculate what it would cost to repair or replace items in case of damage.

Create a Dedicated Fund

Set up a separate savings account specifically for self-insurance. This account should be easily accessible but separate from your everyday savings or checking accounts.

Make Regular Contributions

Budget for your self-insurance fund just like any other fixed cost. Make regular contributions to build up a solid financial cushion.

Reevaluate Periodically

Your property's value and risks might change over time. Make it a habit to reevaluate your financial standing and the sum you've set aside for self-insurance at least once a year.


Self-insuring your property is a major decision that offers both opportunities and risks. It gives you control over your finances but requires meticulous planning and commitment. Before making the leap, evaluate your financial standing carefully, and consult with financial experts to tailor the best strategy for you.

Self-insuring isn't for everyone, but understanding the advantages and drawbacks can help you make an informed decision that aligns with your financial goals and risk tolerance.


Click Here to Read our Definitive Guide to Certificates of Insurance

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Veritas Risk Management, Inc. offers proactive risk management services covering a wide variety of topics. Veritas Risk Management, Inc. does not engage in the practice of law, accounting, or tax consulting.  We encourage everyone to consult with his or her own professional advisor for details concerning his or her specific facts, situations, and circumstances.

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