According to the recently released 2015 RIMS Benchmark Survey by the Risk & Insurance Management Society Inc., businesses paid slightly less in 2014 to cover their total cost of risk than the past three years. Probably not news to most of you out there, but for me it kind of puts the nail in the coffin on the annual prognosis that the hardening of the insurance market is just around the corner.
There were a number of reasons cited in the report including the increasing role of alternative capital in reinsurance deals and the rising importance of predictive models among insurers, not only in the area of property, but also for cyber and casualty. “The 2014 survey results reflect the overall stability of the U.S. property/casualty market,” one of the authors of the report was quoted.
Historically the captive insurance market has seen major growth spurts during cyclical hardening in traditional insurance markets. Costs and availability often would drive institutions to examine the self-insurance world as redress. However, what we are seeing in the captive insurance realm after years of continued soft insurance markets is organizations considering more strategic and long-term trends. A captive insurance company represents an option for many corporations and groups that want to take financial control and manage risks by underwriting their own insurance rather than paying premiums to third-party insurers.
All the more reason to join us in a little over a week for VCIA’s 30th annual captive insurance conference to hear more ideas about strengthening your captive program. VCIA’s conference is the perfect choice for any level of captive industry professional — from newcomer to experienced professional – where you will hear from 70 expert panelists, many are captive owners sharing their stories, and have great opportunities to mingle with key players in the industry.
Commenting on what the industry expects in the second half of 2015, the report said commercial property/casualty insurers are starting to see a softening market. No kidding!
Thank you all very much, and I look forward to seeing you in Burlington very soon!
Rich Smith
VCIA President
Captivated 