Category: Captive insurance
Commercial insurance has been around for centuries since the first of the great London fires engulfed what would have then been the largest city in the world. Not quite water under the bridge, but a lot has changed since then. Commercial and business markets have developed and evolved over time and today they are all in the throes of what is now known as the fourth Industrial Revolution.
You would have thought that given the new technologies associated, all less labor intensive and no longer on massive structural scales, it would mean less risk, certainly lower maintenance, something generally risk averse conventional insurance companies would welcome. But no, that is not quite the case. New risks loom and, panic stricken, conventional insurance companies are running for cover if you will.
And yet they are still able to capture their markets. Where else are they to go to receive the cover they need? They have no alternative but to continue paying higher premiums and paying for the losses of others that could just have easily been avoided had not the correct amount of care been taken. Now, more than ever before, there is a concerted drive towards becoming fully independent of these financial encumbrances. Captive insurance concepts is one such set of developments.
In such instances, commercial enterprises will merely receive limited exposure to these risk averse hegemonies. They are now being aided and abetted by a different skillset and set of business principles which has greater decision making and financial independence at the heart and center of the captive insurance business. Clients are able to build up a fund of own reserves to help them counter losses and damages which could occur and are not always easy to prepare for.