What is a main difference between a pure risk pool, and an insurance company. The cost of the risk transfer to an insurance company is fixed, whereas with a pool one does not know how much they will have to pay eventually, even if they have no claim. Transferring your risk to an insurance company saves you the need to find enough trustworthy members to create a pool. All answers are correct Insurance companies have a certain amount of capital that can be used to cover losses, but it needs to be remunerated, which leads to a higher insurance premium