Specifically, ARM is defined as the discipline by which an organization in any industry assesses, controls, exploits, finances and monitors risks from all sources for the purpose of increasing the organization's short and long-term value to its stakeholders.

It's far more effective to insure against a fortuitus risk via ARM with a Captive Insurance Company, because this approach results in BOTH more insurance and more money for future events.

The illustration here shows why ARM with captive ownership is better than a traditional risk management fund.  It compares the status quo on the left with ARM implementation and captive ownership on the right.  Status quo includes third-party commercial insurance and a traditional wait and see fund.  ARM includes third party commercial insurance, insurance provided by the CIC and a future fund comprised of CIC reserves.  This illustration covers a 10 year period and assumes a 4% rate of investment return for both scenarios.  Both businesses have $1 million per year of profits (that could be applied to risk management).  Each year, the business on the left pays taxes on $1 million and sets aside retained earnings as its "rainy day" fund.  Each year, the business on the right purchases $1 million of insurance from its captive insurance company.  After 10 years, the business on the right which implemented ARM with a captive insurance company has more insurance coverage and more money.  In fact, over a ten year period, the business on the right has almost 80% more wealth than the business on the left.  

Which of these businesses is better prepared for the inevitable risk events in the future? The  answer is obvious!!!!!