Monday, February 26, 2024

Membership options

Legacy management an increasingly valuable tool for captives – Ryan Heyrana

Brown & Brown launched an in-house captive offering for legacy solutions earlier this year because it identified it as an increasingly valuable risk, balance sheet and capital management tool for captive clients.

Brown & Brown, previously through Beecher Carlson, has long provided captive consulting and management services, across the United States and offshore but Ryan Heyrana joined as vice president of legacy solutions, from run-off specialists DARAG, in March 2023.

“There was value in having the ability to offer this specialisation to customers and prospects as an in-house offering,” Heyrana told Captive Intelligence.

Heyrana said being in a position to not only prospectively place a programme but also look at historical liabilities and the “full breadth of retained exposure to identify opportunities” has been popular with customers.

“Particularly because they did not know that it was available to them to improve their overall risk portfolio,” he said.

He said his primary focus is to bring capital solutions, volatility solutions, and operational management solutions to existing and prospective Brown & Brown retail customers.

Heyrana highlighted that the retail corporate market has always been an underserved market in the legacy space, as the transactions tend to be smaller.

“It is rare to find a retail customer with several billion dollars of liabilities on their books,” he said.

However, he said that nine-figure captive deals are not out of the ordinary for Fortune 500 companies with large amounts of workers’ compensation, general liability or other retained exposures on their books.

“There is an active market for much smaller transactions as well,” he added.

Heyrana said that when in discussions with directors of risk management and the decision makers within retail customers, a vast majority of them are unaware that they can “eliminate or relinquish” their legacy liabilities.

“Since starting in this role in March of this year, it has really been an education campaign, not only for our retail customers but also for our retail brokers whose primary focus is the efficient structuring of insurance programs,” he said.

He noted that one of the misunderstood parts of the legacy space is that it is not an “all-or-nothing” transaction.

“You can take a portion of the risk, whether it’s old risks, a certain set of policies, or a certain kind of business that doesn’t suit you and has negative capital implications and find a solution for those ringfenced liabilities,” he said.