Alternatives to Insurance
Effective risk financing is the achievement of the most affordable coverage for an organization’s exposures, while assuring post-loss financial resources are available to cover these obligations. This overall process consists of five steps:
- Identifying and analyzing exposures
- Analyzing alternative risk funding techniques
- Selecting the best risk funding technique(s)
- Implementing the selected technique(s)
- Monitoring the progress and success of the selected technique(s)
Aside from establishing its own captive insurance company, an organization may also look to implement insurance rating plans such as retrospective rating and large deductible or self-insured retention programs.
Generally, the appropriate program will depend primarily upon an organization’s current and historical exposures along with its loss history. Chivaroli & Associates utilizes its in-house analytical resources to identify exposures by type, location, cause, frequency, and severity. In addition, we also use the organization’s historical claims experience to assist in trending and developing current litigation. Each of these studies is then assigned a certain level of importance and incorporated within the overall analysis of the optimal program to pursue.
It is also important to consider current trends and developments in the risk transfer or insurance marketplace as they will influence the financial benefits of implementing an alternative risk funding program.
Chivaroli & Associates will be your partner throughout this entire process, from beginning to end. We will represent your best interests in our negotiations and analyses, placing your organization’s needs and objectives first above all other factors. An alternative risk funding program may not be the most advantageous avenue to pursue; however, all options must be given an equal amount of consideration in order to make an informed decision.