Learn about the alternative solutions for covering your risks
Verlingue has developed unique expertise to meet your need to finance risks that are either insufficiently covered or not covered at all by the traditional market, and to optimise the purchase of insurance. This includes the choice and adjustment of deductibles and retention, parametric insurance policies to cover the risks associated with climate change, the establishment of your own reinsurance company, etc.
Companies are exposed to a multitude of risks that can affect their business. And yet, because of a refusal to cover certain risks, excessively high premiums, overly stringent eligibility criteria, limited coverage, etc., traditional insurance is not always able to propose a suitable contract. To finance risks that are either inadequately covered or not covered at all by traditional insurance contracts, there are various alternative solutions: these “alternative risk transfers”, or ARTs, stem from an analysis of companies’ risks and the introduction of a prevention and protection plan.
Verlingue works with you to examine the potential benefits and suitability of deploying these tailored solutions in your company, depending on your requirements.
The simplest alternative to insurance is to self-finance the risk, but this is often a risky decision. Another option is to optimise the amounts of your contractual deductibles. Our experts provide guidance and support with this approach to help you make the best decision and protect your interests as effectively as possible. They work with you to determine the optimal level of deductible, based on your organisation’s risk sensitivity. Depending on your requirements, they may offer you tailored complementary solutions. In the event of a claim, our teams are at your side each step of the way to manage your excesses and, in the event of damage caused by a third party, to handle any claims submitted to its insurer.
Climate events such as hail, excessively high or low temperatures, flooding, low water levels in rivers, violent storms, etc. can have an impact on your production or your supply chain (in the agri-food business, tourism, industry, etc.). Parametric insurance, because it does not entail damage assessment or complex administrative procedures, is a simple and efficient solution that is often less costly than traditional insurance cover. How does it work? The compensation is paid when a specific index is attained (for a car dealership, this might be the size of the hailstones, for example). Based on the analysis of your risks, Verlingue, which is one of the few insurance companies to implement this solution, will work with you to gauge its pertinence in your case and determine the right threshold for activating the cover.
Some risks incur very expensive premiums or are not transferable on the market. But that doesn’t mean they can’t be covered by insurance! The solution is simply for your company to set up its own reinsurance company, the sole purpose of which is to insure its operations. This solution for self-financing risk coverage, which is mainly recommended for large and intermediate-sized companies, makes it possible to smooth out the cost of the cover or the impact of a claim over time. With the support of specialised partners, Verlingue walks your risk managers through the process of setting up a captive company from A to Z: needs analysis and opportunity study, presentation to the management bodies, creation of the company, management, etc.
What you need to know about captive companies
- A captive company is an insurance or reinsurance company that belongs to a commercial company.
- Over and above the financial investment (capital and running expenses), it needs to be managed like any other entity or operation, and requires an investment of time and expertise if it is to be used for optimal benefit.
- The benefits to be gained by setting up a captive company must be weighed up against the potential savings made on the insurance premium, now transferred to the market, along with other retention mechanisms such as increases in the deductibles. Most importantly, though, it should also be gauged over the long term in the light of what it contributes to the company’s risk-management policy.
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