Self-insurance for medical benefits is sometimes seen as a step into the unknown. After all, companies are taking on more risk, and the potential for catastrophic medical costs can intimidate some business owners. But many experts say that the potential cost savings outweigh the risk. And with each passing year, more information is available on how companies can best manage that risk — ensuring that employers aren't simply taking a leap of faith.

Financial risk is the big factor in whether a company self-insures or not. There's little argument about costs — self-insurance is less expensive and allows employers to customize plans more easily. It is also less heavily regulated.

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