www.captiveinternational.com EMPLOYEE BENEFITS
that can produce the deep level of analytics
needed to maximise the benefit of using a
captive structure. These can be interrogated
to establish the drivers behind medical trends
in various countries. Firms operating captive
schemes can benefit by relying on networks
for reinsurance and data aggregation.
Insights from data analysis should inform
three actions: (i) optimisation of local plan
design; (ii) complementing provisions under the
local policy with impactful global programmes,
such as tele-medicine, second medical
opinion, and employee assistance programmes
where required; and (iii) the design and
implementation of wellness programmes that
are capable of influencing and sustainably
changing employee behaviours.
As it is still not commonplace to reinsure
healthcare benefits via a captive, there is the
potential for significant growth in this area.
Despite growth in recent years there are fewer
than 100 EB captive programmes in place today
compared with the approximately 7,000 captives
across all sectors in the world. While as ever in
the captive marketplace the first movers remain
predominantly the large global multinationals,
there is scope for these arrangements to be
applied in the mid-market.
In the US, the rising cost of healthcare has been
a key driver behind the growth of
stop-loss captives and has been
a subject of much discussion
since many large plans are self-insured.
There are few markets
outside the US in which medical
peak claims require attention
and dedicated risk management. Outside
these few countries, claims volatility is not a
concern and EB captives would normally have the
capacity to fully reinsure medical plans without
the need for extra protection. In these markets the
focus when managing exposure is on medical cost
trends and utilisation.
“Firms operating captive schemes can
benefit by relying on networks for reinsurance
and data aggregation.”
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