edRISK, a sponsored captive, plans to launch two new cells on 1 June, edLIABILITY and edPROPERTY, for liability risk and property risk, respectively.
The organisation already operates edHEALTH, a group medical stop-loss captive for higher education and secondary schools, which recently converted to a cell structure.
“Employee benefits are an important item for these schools, and when we think about what a school does, they teach students, and that means taking care of the faculty and staff who are teaching the students,” David White, chief financial and operating officer for edRISK and edHEALTH, told Captive Intelligence.
“Payroll and benefits are a big part of the operating budget of an educational institution.”
The edHEALTH programme is today the largest part of edRISK, a sponsored captive domiciled in Vermont.
“Even 13 years ago, when we were talking about launching a captive, Vermont was certainly the best domicile, but now they’re also the biggest,” said Tracy Hassett, president and CEO of edRISK and edHEALTH.
“It was the access to the regulators, and it was the flexibility that convinced us to domicile in Vermont.”
White said that Hassett first came up with the idea of whether a cell structure would work.
“Creating a sponsored captive allows common service providers across different cells,” he said.
“When we launch edPROPERTY and edLIABILITY, we may use the same investment manager, the same auditor, captive manager, or actuary, and we think that’ll drive efficiencies for all the member-owners.”
White said the sponsored captive approach provides an opportunity to serve new colleges who are interested in property or liability.
“Schools can decide If they want to join one, two, or three cells.”
White said edHEALTH has never had more inquiries from schools interested in joining because traditional insurance rates keep going up, “and our job at edHEALTH is to bend the cost curve”.
Hassett added that the captive has a very strong focus on trying to help those individuals who are high-cost claimants and need some help navigating the healthcare system.
“We’re also focusing on the rest of the population to make sure they have access to the care they need so they do not become high-cost claimants if we can avoid it,” she said.
Hassett said that she would never tell a school that they cannot join because of their claims.
“That said, what we want to be sure of is that a school is financially stable and has an open mind about controlling their claims,” she added.
“Oftentimes, they come to us because they are looking for some guidance, assistance, support, and some networking with other like-minded people, to help them control the claims.”
In November, White was appointed the new chief financial and operating officer for edRISK and edHEALTH.
“I was the captive manager when edHEALTH was first formed, so I’ve seen the success and I’ve seen how they have achieved it,” White told Captive Intelligence.
“I’ve always enjoyed being part of the team, so now being a bigger part of the team is exciting, especially in this new role because edRISK is growing in so many new directions.”