Review Program Efficiency

When the captive was established a business plan was produced, Time should be taken out to ensure that the goals that were set are being met in terms of corporate philosophy, insurance coverage and profitability.  Am independent review enables this to be achieved on an objective basis.

Review Policy Wording

Claims experience and the inclusion of unintended claims or the exclusion of events meant to be covered should result in a complete review of policy wording.  Also the profitability of the program or the lack there of should cause policy wording to be reviewed.

Actuarial Review

Along with the review of the policy wording an actuarial review should be performed at a minimum annually. It is vitally important that corrective action be taken as soon as possible and if reserves are developing adversely action needs to be taken before results  begin to cascade

Annual Premium Development

Part of that corrective action is setting next years premium level. Premium levels should be correctly set and may have to be defended at some point in the future where the can be questioned with 100% hindsight. A well-documented actuarial study takes any dispute off the table.

Review Underwriting Guidelines

Especially for group captives evaluating whether the right sort of new members are being accepted is critical to success. Many pressures surround this topic.  Should had to head competitors be lowed in, brokers want to bring more business in, members want to spread costs wider.  A review of rent members and submissions exposed a great deal about where the program is heading.  To a lesser extend the same pressures exist in a single parent captive.

Evaluate New Lines of Coverage

To full utilize a captive there must be an efficient use of capital.  This only happens when there is a spread of risk which can be obtained by writing non linear lines of coverage.  This all need to be evaluated.

Collateral Calculation and Negotiation

Negotiation with a fronting carrier can often be more beneficial if an actuary is involved rather than a broker.  Often it is the insurance company actuary thtn are setting the collateral and this is best disputed by a fellow actuary.

Strategic Planning

A plan needs to be in place not only for the immediate future be for a longer time horizon.  This is time consuming and needs an internal champion but also the day to day work can be outsources.