Custom-Driven Solutions To Manage the Cost of Risk

Types of Alternative Risk Solutions Available

The seasoned H&A staff has the expertise in delivering non-traditional solutions to clients with unique risks or for large risks characterized by high frequency and low severity losses. Our relationships with underwriters, actuaries, attorneys, accountants, claims professionals and operational specialists allow us to implement alternative risks solutions that include:

• Self-Insurance Plans: These plans can include retrospectively-rated plans, large-deductible plans, or qualified self-insurance plans whereby an organization chooses to pay to pay its own losses up to a specified amount. Most self-insureds purchase excess insurance to limit their exposure to unacceptable levels of losses. Workers’ Compensation, for example, is a coverage line that many larger organizations choose to self-insure.
• Captive Programs: There are different types of captives available today for Fortune 500 companies, the middle-market sector and smaller organizations. A captive is a licensed and regulated insurance company that insures the risks of its owners, policyholder/ members, affiliated business or unaffiliated business and organizations, including non-profits. Owners of captives put their capital at risk and participate in helping control the underwriting, claims, and investment decisions of the insurance company. The captive operates similarly to a traditional insurance company and it may either issue policies directly to its insureds or act as a reinsurer to another carrier that will actually issue the policy. The captive assumes premiums and pays claims. It also sets aside reserves to pay any legal obligations as result of its insurance coverage or reinsurance agreements. It pays for its operating expenses and can produce an underwriting profit, which can be shared with owners. Additionally, a captive earns investment income on loss reserves and invested assets. Types of captives include: Single-Parent Captives, Group Captives, Association Captives, Protected Cell Captives (PCCs), Agency Captives, Rent-A-Captive, and Risk Retention Groups, among others. We can review how each captive operates, eligibility requirements and commitments, advantages and disadvantages, and what is best for your organization.
• Loss Sensitive Programs: Conventional insurance coverage which allows organizations to adjust their premiums expense based on loss experience.

Benefits of Alternative Risk Solutions

Our goal is to offer clients the ability to gain greater control over managing the cost of their risks, which may involve solutions that go beyond conventional insurance policies and programs. If it makes sense for a client, self-insurance or a captive program can offer the following benefits:

• Enhanced control over your insurance program structure
• The ability to address risks not covered by traditional insurance
• The opportunity to benefit from positive loss experience
• Reduction of total cost of risk
• Customized policy forms
• Reduced volatility of rate, capacity, and coverage
• Deductible flexibility (by location or by coverage line)
• Optimization of risk-retention strategies
• Tax efficiencies
• Premium payment flexibility

H&A offers independent, expert consultation, including analysis of a client’s risk profile, to assess which vehicle and model, if any, would best align with your business goals so that you can make informed decisions on how to proceed in managing risk for optimum outcomes.

Our Commitment to You

At Haughn & Associates (H&A), our core values and principles of integrity, honesty, dependability, innovation, and collaboration shape who we are and guide us; they ultimately allow our team to provide our clients with high-quality insurance products and an unparalleled level of superior service. Each business, family, and individual is given the personalized attention needed to design the right fit of insurance and risk management protection for your insurance package.