Alternative Risk Transfer

MBA Actuaries has decades of experience providing actuarial support for captive insurers, self-insurers and RRG’s. Our Alternative Risk Transfer (ART) services include the evaluation of the appropriateness of different risk transfer vehicles, feasibility studies and on-going review, evaluation and actuarial support services for existing ART programs. We have experience in the key captive markets of Bermuda, Vermont, South Carolina and Cayman Islands and experience in all lines of business. Our specialties include medical malpractice, workers compensation, general liability, automobile liability and health.

MBA supports a wide variety of ART clients including:

As every client’s business is unique, MBA tailors its analyses and methods individually to the needs of its customers. In a typical engagement, we might provide various services including:
• Feasibility studies and plan evaluation
• Reinsurance program design, management and review
• Point estimates of loss reserves and range intervals with confidence levels
• A scorecard of estimates from prior studies
• Results by appropriate breakdown – usually line of business and major business unit
• The forecasting of future policy period loss levels
• Other specialty projects on an as needed basis

MBA’s methods are powerful yet flexible enough to handle the ever changing regulatory, business and information technology landscapes confronting our customers. Hurdles and pitfalls include regulatory compliance, changing third party administrators, changing retention points, changing case reserve adequacy, fiscal period valuations other than 12/31 and small amounts of data, to name a few.

Sample MBA engagements in the ART area include:

• Analyzed reserve levels, reserve ranges and reinsurance cost estimates for a group of Bermuda captive companies owned by an international, multi-division corporation.

• Provided full actuarial reserve estimates and FAS 112 reserve estimates for a self-insurer with both US Longshore & Harbor and state workers compensation loss exposures.

• Provided captive feasibility studies and recommendations for potential captive formations in various lines of business and various domiciles.

• Estimated discounted loss reserves including IBNR for a multi-state, multi-line self-insurer in the process of changing third party claim administrators and data systems.