Claims Management: A Key -- and Overlooked -- Captive Benefit

On Wednesday, September 26, we're giving a webinar on converting from a pool-based captive to a stand-alone pure captive.  The webinar is at 10AM.  You can sign up here.

First, I'd like to offer my best wishes for those on the East Coast.  Last year we lived through Hurricane Harvey, which was one of the most harrowing experiences I've been through.  And, unlike Florence, we didn't have high winds.  So, as we say in Texas, hunker down.

That being said, the coming of Florence highlights an often untold captive insurance benefit: claims management.  Right now, insurance companies are positioning their claims people around the Hurricane area.  When the storm clears, they will flood into the area (no pun intended), working non-stop with the home office to process claims.  But the sheer volume will slow things down.  

If you own your own insurance company, you're in control of the claims process, which gives you a huge advantage.  There are two options.  The first is for the captive to hire an outside third party to manage claims.  But, in a situation like a natural disaster, this can be a hindrance because your third-party claims company is also processing claims for any number of people.  The second option is for the captive to train a company employee to handle claims.  Here, we strongly encourage an employee to become an Associate in Claims from the Institutes.  This employee can then handle the claim and submit the paperwork, at which time the company can cut the check.

At a time when you least want to deal with an entrenched bureaucracy, a captive offers you the opportunity to "do it yourself."  And that can make a huge difference in your operations and business continuity plan.