Tool 02
Funding vs Insurance Economics
Funding buys capital and transfers downside at the cost of upside. Insurance caps a defined downside and leaves the recovery with you. This models the difference on a single successful outcome.
Self-funded
Claimant net on success
£26m
- To funder
- £0
- Carried by insurer
- £0
- Downside if unsuccessful
- £-7m
Funded
Claimant net on success
£18m
- To funder
- £12m
- Carried by insurer
- £0
- Downside if unsuccessful
- £0
Funded + insured
Claimant net on success
£18m
- To funder
- £12m
- Carried by insurer
- £2.4m
- Downside if unsuccessful
- £-600k
Downside comparison
Illustrative example only
- Self-funded
- £7m
- Funded
- £0
- Funded + insured
- £600k
How to read this
- Funder return is modelled as the greater of a multiple on drawn capital and a percentage of proceeds — the two most common commercial shapes.
- The downside row shows what you would carry if the claim failed under each route, not a probability-weighted value.
- Insurance premium is not modelled: premium structures vary and no pricing is quoted anywhere on this site.
- Real funding agreements include waterfalls, priorities and budget conditions that change these numbers materially.
Discuss a real structure
These tools describe how exposure is measured. Terms, limits and availability are decided by underwriting on the facts of the matter.
Request a confidential assessmentGeneral information only. This tool does not provide insurance, legal, investment or financial advice, does not quote premiums, and does not indicate that cover is available.
All figures are illustrative and used to explain how exposure is measured. They are not indicative of pricing, terms or the availability of cover.