1 / 17

ACI’s 3 rd Advanced Forum on Captive Insurance

This conference discusses the current state of the captive insurance market for middle market companies, including coverage, claims, underwriting, and novel risks that can be funded by a captive.

zenaida
Download Presentation

ACI’s 3 rd Advanced Forum on Captive Insurance

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. April 23-24, 2015 ACI’s 3rd Advanced Forum on Captive Insurance State of the Captive Insurance Market For Middle Market Companies Tom Stewart President Innovative Captive Strategies Phone: (515) 223-6852 tstewart@yourcaptive.com Jeffrey K. Simpson Director Gordon, Fournaris & Mammarella, P.A. Phone: (302) 652-2900 jsimpson@gfmlaw.com Brian Johnson Managing Principal Bartlett Actuarial Group Phone: (843) 377-0993 brianj@bartlettactuarialgroup.com Tweeting about this conference?

  2. State of the Captive Market The needs of the small/middle market, the latest in coverage, claims and underwriting, and a look ahead at some of the novel risks that aren’t insured and that can potentially be funded by a captive.

  3. State of the Captive Market • Fairly Soft Market • Some Market Swings for Certain Classes • Lack of Availability of Self-Insurance Options • Strong Performers not Rewarded • Captive Interest is Strong

  4. State of MarketMiddle Market Captive Activity

  5. State of MarketMiddle Market Captive Activity

  6. State of MarketMiddle Market Captive Activity

  7. Number of Captives Worldwide 84% Single Parent 8% Group Captives 4% Risk Retention Group 3% Protected Cell 1% Other May 2013 (Marsh Risk Management) Source: Captive Insurance Company directory, through calendar year 2013

  8. Ideal Candidate • Entrepreneurial Spirit • Desire to Take Control • Commitment to Loss Control and Safety Improvement • Financially Secure

  9. Needs of the Market • What problems have middle market captive owners historically been trying to solve? • Reduce Cost • Pricing Stability • Increased Control • Quality of Service • Fund uninsured exposures • Manage unique business on industry - related exposures • What problems are emerging for the middle-market that a captive could solve?

  10. The Latest in Coverages, Claims and Underwriting • Coverages • Traditional insurance coverages • Ability to increase retentions • Excess coverages • Difference in Conditions coverage • Enterprise Risk Management Coverages • Low frequency / high severity • Generally unavailable in commercial market • Examples: Cyber Liability, Supply Chain Interruption

  11. The Latest in Coverages, Claims and Underwriting • Claims • ERM claims occurring more frequently • Awareness • True emergence of unknown risks • The establishment of insurance companies specifically designed to cover these risks is raising awareness of these risks

  12. The Latest in Coverages, Claims and Underwriting • Underwriting • Models have been developed to quantify the risk • Every occurrence becomes a new data point • Data can be gathered from numerous sources, but not yet one centralized repository

  13. Influence of ERM on middle-market underwriting risk identification and coverage decisions

  14. Novel Risks That Aren’t Insured and that Can Potentially Be Funded by a Captive • Cyber Liability • Supplier/Supply Chain Interruption • Reputational Risk • Contingent Business Interruption • Business Interruption from outside, uncontrollable sources • Loss of Key Employees or Key Customers • Deductibles/Excess/Difference in Conditions

  15. Cultural shift to cover these exposures and make claims. Business processes not currently built for it.

  16. Everyone starting to adjust for experience

  17. Questions and Answers

More Related