A global diversified holdings company with investments in 14 different public and private companies and an annual insurance premium spend of $14.9 million was looking to reduce its premiums without sacrificing coverage.
Its current program was cumbersome to manage as a result of numerous policies that renewed at different times and with different brokers. As a result, the overwhelmed, understaffed treasury team that also served as the internal risk management simply rolled over programs with the same carriers year-after-year without making adjustments to reflect changes in business operations.
The Risk International team was brought in to provide added oversight and diligence on the program throughout the year, while adjusting policies to reflect current business needs and operations. Fully independent from the insurance industry, the external team was able to take a fresh look at competitive offerings and provide unbiased recommendations as to proposed changes in the renewal process. The team started by consolidating policies to not only streamline renewals, but also increase the scale of the policies as a means for garnering more competitive renewal options. In some areas, such as workers’ compensation, Risk International unbundled claims services in order to identify more suitable carriers and improve the service profile. Where it made sense, the team added deductibles where there were previously none in order to realize additional savings.
Changes made in the first year resulted in a savings of $1.5 million. By providing added scale and risk diversification in the second year, the Risk International team saved the client an additional $3.2 million. With a continued focus on efficient management of the various policies and competitively bidding out contracts, Risk International saved the client an additional $2.3 million the following year for a cumulative annual savings of more than $7.1 million over a three-year-period. Beyond the cost savings, the revamped program became more manageable to oversee, resulted in enhanced services and more accurately reflected the current needs of the various businesses, all while aligning the renewals to single date and cutting the number of policies by a third.