What does Hybrid mean? Read on to discover the definition & meaning of the term Hybrid - to help you better understand the language used in insurance policies.
A type of risk financing plan that makes use of both internal and external funds to pay losses. It thus falls between a pure transfer approach and a pure retention approach to risk. The costs of hybrid techniques tend to be less experience-responsive as compared to pure retention but more experience-responsive as compared to pure transfer techniques. Examples of hybrid techniques include pooling arrangements, high-deductible plans, multiple-parent captives, and retrospectively rated insurance policies.
We hope the you have a better understanding of the meaning of Hybrid.