Captive Insurance Management: The Benefits

Benefits

Companies with a solid understanding of their risk profile and a good loss experience can achieve financial, risk management and coverage benefits from captive insurance.

Companies can gain better control over their insurance spend and achieve reductions in overall insurance costs by avoiding the generally higher costs associated with commercial insurance.

Premiums are based on the parent's own loss experience, rather than the performance of the industry as a whole, and companies can directly access the reinsurance market, giving them access to wholesale prices.

Companies can establish greater coverage flexibility than in the commercial insurance sector. Captives provide more bespoke and responsive insurance coverage, providing broader and more stable cover across a wider range of classes.

By taking more proactive control of insurance and risk management, improved claims monitoring processes can facilitate improved risk capital allocation and highlight those areas where claims activity is above acceptable levels.

Furthermore, claims handling processes are enhanced, and can be dealt with in a more efficient and effective manager than can be achieved in the general insurance market.

To discuss these benefits in greater detail and to gain a better understanding of how your organization might benefit from a captive structure, please contact your local Kane office