TCOR – Total Cost of Risk

At a recent professional CFO forum, I was intrigued by a concept on risk that might be of interest to Entrepreneurs.

Instead of the traditional view of insurance, Dana Coates of United Agencies Insurance ( presented a concept of TCOR – Total Cost of Risk.

TCOR includes all of the costs associated with managing a company’s financial risks. TCOR equals risk management administration costs, retained losses related to deductibles and uncovered claims, insurance premiums, and outside service such as consulting, training, sub-contracting.

Viewed from this perspective, Entrepreneurs can appreciate the cost of managing financial risks. It is not just about insurance premiums!

Ravi Patel

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