fbpx
341 4th Ave, Indialantic, FL 32903
321-733-6253
info@DealerRiskServices.com

DISCOVER CAPTIVES

DISCOVER CAPTIVES

Dealers have been using off shore reinsurance companies to house their F & I business for years.

So, why not use the same concept for the other insurance needs?

While it’s true that Vehicle Service contract losses are limited in both time and value, and that Liability and Workers Compensation claims have a longer “tail;” I would argue that using the same ‘’Dealer Owned Insurance Company’’ concept allows Dealers to stabilize their Garage packages and secure a return of underwriting profit.  Something they cannot do in the standard/conventional marketplace.

The key is in the mix…the creative formula…that brings success to a Captive initiative.

The “mix” involves selecting a Captive Manager with solid credentials and experience; choosing a domicile that has a flexible and affordable regulatory environment; selecting a carrier that has all of the necessary forms and will be with you for the long haul; and, choosing a claims TPA with the systems and people to allow you to grow effectively.

The final part is the key ingredient…selecting the right members.

Realize first that the Captive is a business…just like your Dealership.   Therefore, all members need to properly vetted, not just from a Management standpoint (as it relates to profitability), but also from a Risk Management perspective.  Understanding that the more each member controls his/her claims, the less likely there will be any ‘’risk shifting and sharing’’ affecting other members.

In a Captive, you truly need the ‘’best of the best” as members.  You want the competitor you admire for their attention to detail and whose organization you set as a model to replicate.

So, egos aside…find members you would like to do business with and move forward.

Successful captive members share a vision for the future which includes controlling claims and reducing operating costs.  Lowering the administrative costs means more premium is allocated to the claims fund and increases the potential for a return of underwriting profit.

Joining or creating a Captive is a commitment that should not be taken lightly.  It’s the same long term commitment that you have with any business.  Build a sound model with solid components, properly fund for a 5 year (or longer commitment) and trust your work.  When properly organized, and with a strong and tested Risk Management program, a Captive will always provide the lowest cost over time.

Stability, Control, and the Return of Underwriting Profit.  Discover the benefits of a Captive Insurance Company.

Watch for our next info blast…Preparing for a Claim Before it Happens!

Learn More About Captive Insurance @ DealerManagementGroup.net

 

No Comments

Add your comment