Involving a captive in an international programme can optimise structure and reduce the total cost of risk, if executed effectively, according to Jelto Borgmann and Kerstin Kader, of HDI Global.

Speaking on the latest episode of the Global Captive Podcast Borgmann, head of captive services at HDI Global, and Kader, head of HGN technical accounting and intercompany at the multinational insurer, explained the complexity of international programmes, the challenges that need to be overcome and the important role captives can play in improving performance for the group.

Borgmann said businesses with global operations utilise international programmes to harmonise coverages and claims handing, while eliminating much of inconstancies when operating across multiple jurisdictions.

“Captives add an additional layer to it, because with the captive in place behind the international insurance programme, you also have the advantage that you gain greater visibility and control over the risk globally,” Borgmann added.

“And at the end you can decide with this data, for example, you collect from the captive to do risk mitigation measures and then ultimately reduce the total cost of risk.

The podcast discussion also covers currency fluctuations and premium transfer, and the importance of getting compliance right in every territory.

“From a compliance perspective, international programmes ensure that local policies meet the constantly changing regulatory requirements in each jurisdiction while captives provide a centralised risk management solution,” Kader said.

“And this dual approach optimises programme structure, streamlines processes everyone can rely on, and enhances overall transparency.”

Listen to the full international programmes discussion on the Global Captive Podcast here, or on any podcast app.