Online discussion focuses on the effective evaluation of risk transfer products in a rapidly evolving environment
ACE USA has launched an audio podcast on the abundance of traditional and non-traditional risk transfer options.
The discussion is based on an article by Ken Riegler, executive vice president, ACE Risk Management, “When traditional insurance bests a captive,” published in the January 2007 issue of Captive Insurance Company Reports. Also, Carol Frey, vice president, business development and client retention, ACE Risk Management, offers comments stemming from her article, “Guidelines for selecting fronting carriers in an era of change,” published in the April 2006 issue of US Captive.
The discussion explores the multiple challenges and considerations facing today's buyers when managing their own risks. Selecting an insurer to issue policies that will in turn be reinsured by a captive, or fronting company, should be carefully considered, and should transcend far beyond the simplistic approach in terms of price and collateral.
The podcast also examines how the market has evolved, what influences have triggered more participation in all types of risk financing products and how to sift through the myriad of options available to determine what’s right for each client.
“To succeed in today’s rapidly evolving environment, buyers of risk-financing products must carefully evaluate and determine their cost of risk and at what level they can participate in that risk in order to balance their risk appetite and risk transfer. Captives demand an extra level of evaluation as these structures require putting the buyer’s own capital at risk. The ACE Risk Management podcast explores a range of pertinent and timely selection considerations, and gives useful guidelines for matching the fronting carrier to the unique risk financing program," said Mr. Riegler.