title slide jun 8 – 10, 2015 group captives
TRANSCRIPT
Title Slide
JUN 8 – 10, 2015
www.bermudacaptive.bm
GROUP CAPTIVESGROUP CAPTIVES
Group Captives
Speakers:•Carol Frey, Divisional VP, Great American
Insurance Company•Robert Bernatchez, Principal, Brisk Management
Services LLC•Scott Penwell, Partner, Rhoads and Sinon LLP•Geoffrey Gardner, Senior Advisor, PRP Performa Ltd.
Moderator:•Dennis Silvia, President, Cedar Consulting LLC
Herding Cats
Organizing a Group Captive program has been likened to “herding cats”.
Multidiscipline discussion with a focus on:•Vision, from an organizer’s perspective•Practical considerations from a front company’s perspective•Governance from a legal perspective•Asset planning and management from an investment manager’s
perspective
• Customized program design– Reduce cost of risk for participants– Specialized claims handling– Bespoke Loss Control services
• Capital and Letters of Credit
• Plan to reach initial critical mass and maintain growth with best in class participants
Organizer’s Vision
• Transparency and fairness to participating members
• Balancing individual needs with what is in best interest of the group
• Long term flexibility to meet participant’s future needs
• Recouping start up costs
Organizer’s Vision
• Feasibility Analysis– Full submission including currently valued loss runs and
exposure data with actuarial support– Coverage Templates– Member-to-Member Risk sharing plan– Reinsurance types and attachment points
• Commitment on the part of organizer and participants– Volume– Distribution– Patience
Practical Considerations
•Vendor Selection– Loss Control/Risk Management Services– Captive Management– Front Company– Reinsurer
•Tax status…To be or not to be 953(d)
Practical Considerations
•Owned Group Captive versus Segregated Account Structure– Capital vs. Collateral– Startup and Closing captive– Flexibility vs. Sponsor Control
•Tax Considerations
•Documents and Agreements
Governance and Control
•Controlling and Governance– Officers and Directors– Committees– Codes of Conduct– Independent Directors– Dividend Distributions
• Timing• Mutual Agreement
– Membership• New members• Members exiting
Governance and Control
•Selection and evaluation of investment management
•The asset allocation decision– Need for letters of credit linked to investment– Balance dynamic of maximized returns and liquidity/capital
preservation
Asset Planning and Management
•Board of Directors evaluation of investment performance
•Advantages/Disadvantages of bundling asset management with custody and LOC services
Asset Planning and Management
Q&A