After reviewing a few captives this year it is surprising that they can still sell this to their client base – our firm has found over charging in the captives of up to 50% of what the current market prices are for coverages on workers’ compensation, commercial auto, property. Captives markets are a good place to look for coverage but they should never be viewed as the only place to be. Dividends are down, premiums are up – take a look at some other avenues.
Andrea:
You are making your observation in a vacume. Current captive pricing is just a piece of the puzzle. Members get to participate in investment income, achieve rate stability, choose who handles their claims, obtain difficult coverages, and many other benefits. You should really read-up on captives because they are a great risk management alternative for many insureds.
I get it quite well Captive Expert – captives are an option for my clients that we look at and can work well – never said they didn’t or couldn’t – it is just like all forms of insurance the consumer needs to watch their back. To rely solely on the captive keeping their best interest at heart is foolish as I have seen. One of my clients was paying 50% over any market price out there and the year before they were paying 70% more and they had no loss issues, nor were they a tough risk. They were paying $6,000 per vehicle on their auto coverage for standard vehicles, no claims, good drivers – why? They were just being over charged and what they got back in dividends did not make up the difference in the overpayment they had been charged. All I am saying is that businesses need to review periodically what they are buying and look at the whole picture – even in a captive a business can be taken advantage.
After reviewing a few captives this year it is surprising that they can still sell this to their client base – our firm has found over charging in the captives of up to 50% of what the current market prices are for coverages on workers’ compensation, commercial auto, property. Captives markets are a good place to look for coverage but they should never be viewed as the only place to be. Dividends are down, premiums are up – take a look at some other avenues.
Andrea Luoni
http://www.ratecraft.com
Andrea:
You are making your observation in a vacume. Current captive pricing is just a piece of the puzzle. Members get to participate in investment income, achieve rate stability, choose who handles their claims, obtain difficult coverages, and many other benefits. You should really read-up on captives because they are a great risk management alternative for many insureds.
I get it quite well Captive Expert – captives are an option for my clients that we look at and can work well – never said they didn’t or couldn’t – it is just like all forms of insurance the consumer needs to watch their back. To rely solely on the captive keeping their best interest at heart is foolish as I have seen. One of my clients was paying 50% over any market price out there and the year before they were paying 70% more and they had no loss issues, nor were they a tough risk. They were paying $6,000 per vehicle on their auto coverage for standard vehicles, no claims, good drivers – why? They were just being over charged and what they got back in dividends did not make up the difference in the overpayment they had been charged. All I am saying is that businesses need to review periodically what they are buying and look at the whole picture – even in a captive a business can be taken advantage.
Andrea Luoni
http://www.ratecraft.com