Multinational Pooling

AAA

DEFINITION of 'Multinational Pooling'

A method global companies use to manage the risk of their employee benefit plans throughout the world. The different employee benefit programs of a mulinational company are combined to form an international pool. The result of multinational pooling is financial savings and better control of the risks.

INVESTOPEDIA EXPLAINS 'Multinational Pooling'

There are two types of multinational pooling: company-specific and multi-client. Company-specific pooling is used by multinationals with international clients who are large enough to do the pooling on their own. Multi-client pools are available for companies who are less global but can none the less save costs by joining forces with other companies.

The merits of multinational pooling include:
- Economies of scale and purchasing power
- Global experience rating
- Financial cost savings
- Improved underwriting terms and conditions
- Annual reporting
- Management tool and information base

RELATED TERMS
  1. Articles Of Incorporation

    A set of documents filed with a government body to legally document ...
  2. Dow Jones Global Titans 50 Index

    A market capitalization-weighted index of 50 of the largest multinational ...
  3. World Trade Organization - WTO

    An international organization dealing with the global rules of ...
  4. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at ...
  5. Value Of Risk (VOR)

    The financial benefit that a risk-taking activity will bring ...
  6. Business Judgment Rule

    A legal principle which grants directors, officers, and agents ...
RELATED FAQS
  1. What is political risk and what can a multinational company do to minimize exposure?

    For multinational companies, political risk refers to the risk that a host country will make political decisions that will ... Read Full Answer >>
  2. Why would a multinational corporation conduct a vertical foreign direct investment?

    In many cases, multinational corporations conduct horizontal foreign direct investment (FDI) activities in order to expand ... Read Full Answer >>
  3. What are the different types of price discrimination and how are they used?

    Price discrimination is one of the competitive practices used by larger, established businesses in an attempt to profit from ... Read Full Answer >>
  4. What are the different sources of business risk?

    A certain risk level is inherent in running a business. A company cannot completely eliminate risk, but it can control or ... Read Full Answer >>
  5. How does the law of diminishing returns affect marginal revenue?

    The law of diminishing returns is better thought of as the law of increasing opportunity costs. The law states that -- if ... Read Full Answer >>
  6. What is the theory of asymmetric information in economics?

    The theory of asymmetric information was developed in the 1970s and 1980s as a plausible explanation for common phenomena ... Read Full Answer >>
Related Articles
  1. Insurance

    Investing Beyond Your Borders

    Investing abroad poses risks, but can also help you diversify. Discover ways to invest in foreign stocks.
  2. Economics

    What Is Supply?

    Supply is the amount of goods a producer is willing to produce at a given price, and is one of the most basic concepts in economics.
  3. Economics

    What is a Management Buyout?

    A management buyout, or MBO, is a transaction where a company's management team purchases the assets and operations of the business they manage.
  4. Economics

    Understanding Green Field Investments

    A green field investment refers to a company, usually a large multi-national corporation, building a new facility in a foreign country.
  5. Economics

    Modified Internal Rate of Return (MIRR)

    Modified internal rate of return (MIRR) is a variant of the more traditional internal rate of return calculation.
  6. Economics

    Explaining Cash On Delivery

    Cash on delivery, also referred to as COD, is a method of shipping goods to buyers who do not have credit terms with the seller.
  7. Credit & Loans

    What's a Revolving Line of Credit?

    A revolving line of credit is an arrangement made between a company or an individual and a bank to borrow money on a short-term basis.
  8. Economics

    Understanding Horizontal Integration

    Horizontal integration is the acquisition or internal creation of related businesses to a company’s current business focus.
  9. Economics

    Understanding Marginal Benefit

    Marginal benefit is an economic term that describes the maximum amount a consumer is willing to pay for an additional unit of a good or service.
  10. Personal Finance

    Will Tesla Cars Ever Be Affordable?

    Tesla cars are highly sought after, but also command a very high price tag.

You May Also Like

Hot Definitions
  1. Fisher Effect

    An economic theory proposed by economist Irving Fisher that describes the relationship between inflation and both real and ...
  2. Fiduciary

    1. A person legally appointed and authorized to hold assets in trust for another person. The fiduciary manages the assets ...
  3. Expected Return

    The amount one would anticipate receiving on an investment that has various known or expected rates of return. For example, ...
  4. Carrying Value

    An accounting measure of value, where the value of an asset or a company is based on the figures in the company's balance ...
  5. Capital Account

    A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public ...
  6. Brand Equity

    The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. ...
Trading Center