Q: Which of the following does not apply to self-funding?

Mark one answer:
A. A trust fund is established by an employer or plan and regulated by
B. A trust fund pays claims and retained profits are applied to future expenses
C. Requires an insurance company
D. Referred to as "self-insurance"



Answer :

Final answer:

Self-funding is an internal method used by organizations to provide benefits to employees, offering flexibility and potential cost savings.


Explanation:

Self-funding is a method used by organizations to provide benefits to their employees, such as health insurance, by setting aside funds internally rather than purchasing traditional insurance policies.

It is not dependent on an external insurance company, allows for more flexibility in designing benefit plans, and can potentially lead to cost savings for the organization.

Examples of self-funding include setting up internal service funds for professional liability insurance, workers' compensation, and health insurance for employees.


Learn more about self-funding and internal service funds here:

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