PikaGuard Blog

Analysis on risk, insurance strategy and the decisions behind both.

For the fundamentals in order, the risk library is further down this page: 28 articles that build on each other, from what a risk costs to what a balance sheet can absorb.

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4 ARTICLES

Risk fundamentals

Risk cost, not premium: a better way to think about insurance

A quote is the start of the decision, not the end of it. How to weigh the cost of a risk, the losses you can retain, and the events you need to transfer.

July 18, 20267 min readThe PikaGuard Team

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Coverage

When does a higher deductible make sense?

The right question is not simply how much premium you save, but whether reserves can absorb the extra losses across a realistic range of outcomes.

June 26, 20266 min readThe PikaGuard Team

Security

Insurance or mitigation: spend where it changes the risk

Cover transfers a risk. Better controls can reduce it. A good strategy compares both before capital is committed.

May 30, 20265 min readThe PikaGuard Team

Company

Why risk should be a range, not a single number

Transparent risk analysis keeps uncertainty visible and cross-checks its sources, rather than settling on one precise estimate.

April 22, 20266 min readThe PikaGuard Team

The risk library

28 ARTICLES · 6 PARTS · READ IN ORDER

Twenty-eight articles on the cost of risk. Each takes one idea that costs money and works it through on a figure. The same library sits behind the Learn tab in the client portal.

Part I · Articles 01–06

What a risk costs

Risk Cost: the £40 glass

What a risk costs per month, before anyone quotes a price.

The loading factor

Why an insurer never sells £1 of risk for £1, and what the gap pays for.

Why the average is a fair basis for a decision

The answer to the standard objection: ‘it either happens or it doesn’t’.

Putting probabilities in context

Percentages restated as the waiting time between events.

A single number is a red flag

Why an honest estimate arrives as a range, and precision is not accuracy.

Total cost of risk, not premium

Three of the four numbers that make up the cost of risk never appear on an invoice.

Part II · Articles 07–12

What the policy says

It is the clauses, not yes or no

A policy is not a yes or a no. It is six dials, and one of them takes most of the discussion.

Sums insured: rebuild cost, not market value

The number in your schedule is not what the building is worth. It is what it costs to put back.

Underinsurance and the average clause

Insure for 60% of the value and a £200,000 loss can be paid at £120,000.

Aggregate limits and per-event limits

Two policies offering ‘£5m of cover’ can behave very differently in a bad year.

The clauses that decide whether a claim gets paid

Some clauses are not advice. Miss one and the claim is not paid.

Business interruption, properly explained

The cover people buy most casually, with the two settings that are usually wrong.

Part III · Articles 13–16

Where the premium goes

Broker commissions

Your broker is usually paid by the insurer, out of your premium, as a percentage of it.

The lottery lesson

If the other side profits on average, you lose on average. That is still a reason to buy.

People buy insurance emotionally

A common pricing method in British business is ‘last year, plus a bit’.

Will you actually get paid?

Cover is a promise. How reliably and how fast it is kept is part of the price.

Part IV · Articles 17–21

What your balance sheet can absorb

When you should take the hit yourself

Insurance is for losses you cannot afford. Everything else is expensive cash-flow smoothing.

Setting your own bar

Before any model runs, someone has to say how bad a year the business must survive.

The importance of reserves

Cash on the balance sheet is already doing insurance work. It is rarely counted that way.

Can your reserves absorb a bad year?

The question is not what an average year costs. It is how often a year costs more than you have.

The internal pool

Pay the loading to yourself for the layer of risk you have decided to keep.

Part V · Articles 22–24

Reserves and return

Idle capital has a cost

A reserve in a current account is shrinking. That is a real cost of self-insuring.

Real investment returns

A 5% return in a 3% inflation year is a 2% return. Unadjusted numbers flatter everyone.

Insurance-grade investment

For money you might need at short notice, the size of the swings matters more than the size of the return.

Part VI · Articles 25–28

Reducing the risk

Reduce it instead of insuring it

Pay every year to be compensated after the fire, or once to make the fire less likely.

Team training for risk

Most losses have a person in the chain. Training is usually the cheapest lever on frequency a business owns.

Rare, ruinous events

You cannot insure everything catastrophic. Trying would drain you faster than the events.

Risks are dynamic

You are insured for the business you were when you last thought about it.

Every figure in this library is illustrative: round numbers chosen to make a mechanism visible, never a quote, a market rate, or a prediction about your business. The articles explain how the machinery works; they are not insurance, legal, actuarial, or investment advice.