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The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

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The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance explores the challenges presented by today's business and economic upheaval, as well as the hardening insurance market, and what it means for the captive insurance industry.

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It's Time To Open the Risk Finance or Captive Playbook!

 A businessman
February 06, 2020

One way to mitigate rising premium costs in a hardening insurance market, as we are now experiencing, is with risk retention. Many sizable companies are currently buying guaranteed cost insurance either on a first-dollar basis or with much lower deductibles than the organization is capable of retaining. If that applies to your company—or your clients—it's time to get innovative. This entails determining the organization's risk retention capability and exploring the myriad of risk finance and captive insurance alternatives available to it. Depending on the organization, there is an entire smorgasbord on the menu, from large deductibles to self-insurance to group captives and pools to wholly owned captive insurance subsidiaries.

Fortunately, IRMI publishes a number of resources to help you evaluate the options and choose the most efficient solution for any organization, and you likely have access to some of them in IRMI Online or Vertafore ReferenceConnect (formerly SilverPlume). The first and still the best "risk finance playbook" ever published is Risk Financing. This resource leads you through the process of loss forecasting, determining risk retention levels, and preparing a feasibility study. It lays out the pros and cons of all the options, explains the tax implications, provides cost indexes and loss development factors, and much more.

Take a look at Risk Financing in the platform to which your company subscribes (IRMI Online or Vertafore ReferenceConnect), and think about how it can help you navigate hard market challenges. If you don't subscribe, learn more about Risk Financing here.

If you think a captive insurance option might be the way to go, we can help you become an expert in short order. First of all, you should subscribe to our free Captive Wire newsletter if you don't already do so. Secondly, you should consider buying one of our captive insurance books or subscribing to Captive Insurance Company Reports. Having these resources at your fingertips will give you instant captive insurance expertise. If you don't already subscribe in IRMI Online or Vertafore ReferenceConnect, schedule a private virtual tour of the IRMI risk finance and captive insurance resources with one of our resource consultants.

We'll also be exploring captive insurance options and other hard market survival tactics at the IRMI Energy Risk and Insurance Conference (ERIC) in April. The program is packed with new topics and speakers, and we will focus on practical steps you can take to control insurance costs and better manage energy company risks. Review the ERIC agenda and register now.

Advertisement--Click here to view the agenda and register for the IRMI Energy Risk & Insurance Conference

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