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Risk-sharing group captives lower loss costs and provide superior results <br />
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Columbus, OH, September 30, 2008 - Small to mid-sized companies are reducing loss costs, lowering risks, and improving premium savings with a unique risk-sharing group captives model developed by Avizent, a national risk management provider.<br />
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For example, Miller United's Restaurant Franchise Captive Program, developed by Avizent, has grown substantially since it began four years ago. "The program started out with three insureds and $2 million in premium, and now has 13 insured companies and over $6 million in premium, in spite of decreasing rates in the soft market, said Everett Newman, director of alternative risk services at Miller United Insurance Brokerage. "This program has a four-year cumulative loss ratio of 9.9%, which is an excellent result, added Newman. He also noted that Avizent's claim services have been a major factor in the success of the program. <br />
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Group captives allow mid-sized employers to join forces and form a captive insurance program - an option usually only feasible for larger Fortune 1000 companies. Captives allow organizations to create their own internal insurance company, creating not only lower costs, but also increased synergies and improved risk management outcomes. Companies can form their own group captive or utilize Avizent's captive option in Bermuda. <br />
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Avizent's unique model combines the claims management services of an expert third party administrator and an easy-to-access captive structure with the willingness to bear part of the financial risk - an approach that can lower claim costs and return premium dollars to the employer when losses are low. Employers can also participate in the profits produced through favorable underwriting results. <br />
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"Not only does the group benefit financially and operationally, but brokers and managing general agents receive an additional revenue stream when their clients select the group captive option, noted Rick Stasi, chief operating officer for Avizent Alternative Risk. "It's a win for everyone involved. <br />
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"Avizent's willingness to take on some of the risk is a benefit and strengthens the alignment of interest among all parties. When everyone involved in a program is united by a common goal, we typically see more open communication and a collaborative effort that yields superior results, explained Sarah Comerford, divisional assistant vice president in the Alternative Markets Division at Great American Insurance Group. <br />
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Avizent's group captives offer the advantage of stable or lower insurance premiums, which are based on the group's loss experience rather than the industry as a whole. By participating in a group captive, employers are better prepared for hard market cycles, which are expected every four to five years and include high rates, low limits and restricted coverage. <br />
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"One of the best kept secrets in the industry is that the best time to explore a captive is now - during a relatively soft market, as opposed to later when the market is hard, notes Stasi. "When the market is hard, finding coverage may be more difficult; plus start up time for a captive is typically one year. Those who start a captive now will be well positioned once the hard market hits.<br />
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In addition to the benefits of participating in program profits and maintaining stable insurance premiums, group captive programs offer many other advantages including:<br />
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Better focus on risk management and the effectiveness of customized "unbundled risk management services that lower the cost of risk;<br />
Improved vendor quality due to economies of scale, allowing effective negotiation for insurance services that are tailored to your program;<br />
Control of your own destiny through active governance in your own insurance company;<br />
Shared risk management resources and information among members;<br />
Fully deductible premiums; and<br />
Investment income on funds set aside for loss reserves.<br />
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About Avizent<br />
Avizent, based in Columbus, Ohio, is one of the fastest growing national risk management providers of claims management, medical managed care, self-insured groups, alternative risk financing and RMIS software. The company employs nearly 800 associates throughout the United States. For additional information, visit the Avizent website at www.avizentrisk.com or call 888-646-9675.<br />
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About Miller United Insurance Brokerage<br />
Miller United specializes in captive formation and management. The company is located in Costa Mesa, California and has been in business for 10 years. <br />
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About Great American Insurance Group<br />
Great American's roots go back to 1872 with the founding of its flagship company, Great American Insurance Company. Based in Cincinnati, Ohio, Great American Insurance Group is engaged primarily in property and casualty insurance, focusing on specialty commercial products for businesses, and in the sale of traditional fixed, indexed and variable annuities and supplemental insurance products. This year marks the 100th year that Great American Insurance Company has received an "A (Excellent) or higher rating from the A.M. Best Company (as of Dec. 17, 2007).<br />
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Company Contact:<br />
Tracy Mock<br />
847-543-1681<br />
tmock@avizentrisk.com<br />
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Media Contact:<br />
Joy Scott<br />
818-610-0270<br />
joy@scottpublicrelations.com<br />
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