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Captive Intelligence provides high-value information, industry analysis, exclusive interviews and business intelligence tools to professionals in the captive insurance market.
GCP Exclusive: Meta’s captive ‘Laser DIC’ policy for Side A D&O
In episode 77 of the Global Captive Podcast, supported by legacy specialists R&Q, we have an exclusive discussion with Meta and its insurance partners in which they explain its new and unique approach to insuring Side A D&O through its own Hawaii-domiciled captive.
Richard in joined by Janaize Markland, director of business risk and insurance at Meta, Lauri Floresca, a specialist D&O broker with Woodruff Sawyer, and Nick Troxell, manager of global captive fronting at Allianz Global Corporate & Specialty (AGCS), who discuss the context of the hard D&O market of the past three years, recent corporate law changes in Delaware that made the solution possible and the structure of the ‘Laser DIC’ Side A policy that has been deployed.
Read the associated article here.
US middle market continues rapid captive growth, MSL major driver
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Captive Intelligence provides high-value information, industry analysis, exclusive interviews and business intelligence tools to professionals in the captive insurance market.
TRISTAR acquires Hawaii-based TPA
TRISTAR Claims Management Services has completed the acquisition of FiRMS Claims Services (FCS), a Hawaii-domiciled third-party administrator.
TRISTAR, which provides services in property & casualty claims and benefits administration, works closely with captives and the alternative market in the Unites States.
FCS services the Hawaii marketplace and has been acquired from First Insurance Company of Hawaii, Ltd (FICOH).
“We are excited to welcome the FCS team to the TRISTAR family. Similar to Matrix, a previous acquisition of ours, FiRMS is a Tokio Marine subsidiary and, therefore, part of an organization with whom we share common values,” Tom Veale, President of TRISTAR.
“We now have full claims handling capability for auto, liability, workers compensation, and disability in Hawaii, making TRISTAR one of the few companies with direct employees handling claim files in all 50 states.”
The new Hawaii team will report to Mark Antonson, Senior VP of the Western Region at TRISTAR.
Price volatility, M&A and defence strategies lead healthcare motives
Now is the prime time for healthcare companies or professionals to either join or start a captive, experts told Captive Intelligence at the 2022 Cayman Captive Forum.
“We’re definitely in a hard market, rates are going up and capacity is less,” Amy Evans, executive vice president at Intercare Holdings, said.
“There’s still a lot of capital in the commercial market, but they are reducing cover and they’re not insuring a lot of things.”
Evans also noted that healthcare professionals are increasingly wanting to control their own risk.
“They are just tired of the volatility, they are naturally creative people who are always striving for innovation because you can’t be complacent in healthcare,” she added. “You’ve always got to be one step ahead and strategic.”
Dr Ira Richterman launched the Cayman-domiciled StarKap Insurance Company in 2005, due to proliferating costs for medical malpractice insurance in the commercial market.
“For myself, a lot of my friends, malpractice insurance as a small independent group was unaffordable,” he said.
“As a result, in 2005, an orthopaedic group, an anaesthesia group, and a large multi-specialty, medicine group got together, and we all felt the captive was the right thing for our practices and more importantly for our community.”
M&A
Heather McClure, chief risk advisor in the US Healthcare Practice at Aon, noted that the merger of physicians into hospital employment over the last three years has grown “exponentially”, which has benefited physicians in their defence against lawsuits.
“What that means for the risk is that those physicians don’t have their own separate policies anymore, as their risk is joined with the hospitals,” she said.
McClure added that the plaintiff’s attorneys used to be able to pick off and sue the physician or the hospital separately. “And now there’s that opportunity for joint defence.”
Oklahoma has “tremendous” growth potential as a domicile – Kinion
Steve Kinion, Oklahoma’s new captive director, has outlined the potential and his ambitions for the state as a captive domicile, in an exclusive interview with Captive Intelligence.
Kinion was Delaware’s captive regulator for more than 13 years, but left the post in September after failing to agree a contract renewal.
He originally joined the Oklahoma Insurance Department in 1995 as counsel to the Oklahoma state board for property and casualty rates and assistant general counsel.
As in Delaware, Kinion will serve in his new position as a contractor and remain based in Illinois.
Since returning to Oklahoma’s insurance department, Kinion said most captive applications he’s seen have been from Oklahoma-based businesses, with carbon industries having a big presence.
“They may have a difficult time obtaining insurance coverage in the commercial market,” he said. “They’re welcome in Oklahoma because Oklahoma has a long history with that industry.”
“Entrepreneurial” Commissoner Mulready
Oklahoma’s new captive director said the state’s insurance commissioner, Glen Mulready, was crucial to his decision to return.
“Mulready is a commissioner who is what I call an entrepreneurial thinker,” Kinion said. “He wants to make Oklahoma the best insurance department it can be, if not the best insurance department in the United States.”
He noted that Mulready was excited about future of captives in the state, which also helped entice him to the role.
“This is a very good thing because if you have the support from the very top, you’ll be successful,” he said.
Kinion said he was excited about Oklahoma’s new Insurance Business Transfers (IBT) law, which allows companies to transfer books of business to a new company.
“Commissioner Mulready wanted to make a good captive insurance programme that really serves the needs of Oklahoma-based businesses, so they no longer have to look elsewhere for their captive insurance risk management needs,” Kinion said.
He noted that Oklahoma had been successful with the two IBT tractions it had completed already, suggesting there might be four more coming to the state in the near future.
“Mulready understood that I’m a native of the state and asked me if I would consider coming back and being part of the success, and I said yes.”
Kinion acknowledged that although it seems like he’s coming “full circle” with his return to Oklahoma, he is not coming to the end of his career and is simply “going back to a familiar environment and an environment that I know”.
In his final weeks as Delaware’s captive regulator, Kinion spoke to the Global Captive Podcast about his plans to focus more on his captive legal practice, and in particular his desire to provide consulting around the area of D&O being written in captives.
One of the main reasons Kinion accepted the new position was because it allowed him to continue to be based in Illinois and remain working as a lawyer at Zack Stamp.
“I did the same in Delaware very successfully, and I can do the same in Oklahoma,” he said.
Kinion also praised the success of the most recent Oaklahoma captive conference, which had almost 300 attendees this year. “I was one of the fortunate people who got a space early and I saw the electricity in the air, and the excitement about Oklahoma’s captive programme,” he added.
Enel’s captive PSI signatory is “finishing touch” for sustainability focus
- Enel Insurance tasked with contributing to group sustainability initiatives
- Captive focused on four pillars – finance, underwriting, governance and reporting
- Nervini says “the time is now” for more captives to sign the UN’s PSIs
- Read Aon and the UN’s white paper on Using a Captive to Drive Positive ESG Outcomes here.
Antonio Nervini, Head of Insurance in the Netherlands at Enel Insurance N.V., is hoping that other captives follow the Italian multinational’s lead in signing up to the United Nations’ Principles for Sustainable Insurance (PSI).
Speaking exclusively to Captive Intelligence in GCP #76, recorded in Luxembourg in November, Nervini explained why and how Enel Insurance had become the first captive signatory of the PSI.
The podcast discussion also featured Butch Bacani, programme leader for the UN’s Principles for Sustainable Insurance initiative, and Ciaran Healy, chief commercial officer for EMEA at Aon Global Risk Consulting.
Aon and the UN have published a white paper on Using a Captive Insurance Company to Drive Positive ESG Outcomes. Read it here.
Nervini said that the Netherlands-domiciled captive had previously been tasked with contributing to the wider group’s sustainability efforts and initially had struggled to understand or appreciate the role the captive could play.
“The first reaction [from the captive], was we can do nothing actually,” he said.
“We were pushed to take actions anyway and we started to figure out what we could really do for sustainability. There are actually many actions that can be done by a captive.”
Enel has a track record of embracing and investing in renewable and sustainable energy practices, including being the first to design and install smart meters in 2001, and the first private company in the renewable power sector to be listed on the Dow Jones Sustainability Index.
Enel Insurance pursued a sustainable framework for the captive based on four pillars – sustainable finance, underwriting and risk management, compliance and governance, and reporting.
Nervini paid special thanks to the Guernsey International Insurance Association (GIIA) for the publication of its ESG Framework for Insurers in 2021.
“It was extremely, and it is extremely, useful for captives to understand what to do,” he said.
Nervini said to have “real sustainable finance” completely embedded in the captive’s investment strategy was a big achievement and more sophisticated than a simple approach with a list of restrictions.
“Once we achieved the first step, we moved to underwriting and even in underwriting captives can do a lot,” he added. “We can help the group to achieve sustainable targets.”
These included having Sustainable Development Goals (SDG) embedded in international programmes, and the captive providing support to the group during the pandemic.
Nervini also emphasised the importance of reporting and said this is one of the most important areas to get right and develop in the future.
“Reporting means that you have to be taken accountable for what you do,” he said. “You have to measure your actions.
“It can be done for sustainable finance, but for the other pillars it’s quite difficult. So what I look forward to is to be rated by agencies in our performance as a sustainable captive.”
More broadly, Nervini explained that the captive becoming a signatory of the PSI earlier this year was simply the “finishing touch of a longer process of working on sustainability for the captive”.
He explained one of the motivations to become a signatory was to lead the way and he now hopes other captives will follow suit.
“We understood that it was time for us to step in and take the lead and try to advocate for sustainable insurance,” he said.
“It’s time for captives to join the PSI. It’s time to take action. So we would like to think that others will come soon. This is our main goal, to invite others to join us.”
You can listen to the full 25-minute discussion between Antonio Nervini, the UN’s Butch Bacani and Aon’s Ciaran Healy on the Captive Intelligence site here, or on any podcast app. Just search for the ‘Global Captive Podcast’.
GCP #76: Enel Insurance, the first captive signatory of the UN’s Principles for Sustainable Insurance
In episode 76 of the Global Captive Podcast, supported by legacy specialists R&Q, Richard is joined by three of the professionals instrumental in the first captive insurance signatory of the United Nations’ Principles for Sustainable Insurance (PSI).
Earlier this year Enel Insurance, the Netherlands-domiciled captive owned by Italian energy multinational Enel, became the first captive to sign up to the PSI.
In a 25 minute discussion recorded at the European Captive Forum in Luxembourg, in November, listeners will hear from Antonio Nervini, Head of Insurance in the Netherlands at Enel, Butch Bacani, Programme Leader for the UN’s Principles for Sustainable Insurance, and Ciaran Healy, Chief Commercial Officer for EMEA at Aon Global Risk Consulting.
Now Enel has a long track record of embracing and investing in renewable and sustainable energy practices, including being the first to design and install smart meters in 2001, and the first private company in the renewable power sector to be listed on the Dow Jones Sustainability Index. And this step by the captive to sign up to the PSI is a good reflection of a group-wide approach to meeting sustainability and ESG targets.
Antonio will explain why Enel wanted to be the first captive to become a signatory of the PSI, Ciaran explains the work involved and whether he expects other captives to follow suit, but Butch begins provides some background on the PSI and his own ambitions for the captive market.
To read the Report authored by Aon and the United Nations on Using a Captive Insurance Company to Drive Positive ESG Outcomes, click here.
Zurich Friend of the Podcast
Today, more and more companies are exploring the many benefits of including both non-life and life risks in their captive programs. As an industry leader in captive services, Zurich draws on more than 30 years of experience helping our customers realize the benefits of captives. Our services encompass life, non-life and consolidated captive services.
With 255 single parent captive customers and over 500 captive fronting programs, we have the expertise, global setup and processes to help you implement solid captive solutions across borders. As an experienced captive insurance partner, we offer a range of global solutions and network capabilities to help you establish and manage your captives, regardless of whether it is a single-parent, group, agency, cell or program captive.
KEY CONTACTS
RETO HEINI
Regional Distribution Manager & Captive Specialist Europe, Zurich Global Employee Benefits Solutions
Felipe Chacón
Regional Distribution Manager & Captive Specialist Americas, Zurich Global Employee Benefits Solutions