Helping America’s Business Owners
From its origins in ancient times, insurance has evolved in response to the need for business owners to mitigate against or diversify from the risks that they confront in their commercial activities. As insurance solutions have advanced through the ages, pooling and diversification of these risks have progressed to become a scientific discipline.
Corporate owners, their leadership teams and independent advisors may be unaware of the total cost of risks they face or the multitude of options available to effectively address them.
Thankfully, senior management teams and their advisors have more options available to them for risk management than ever before. This begs the question: how do they begin a dialogue? Rest assured that the Oxford team is just a phone call away– your strategic partner who is always available to lead a discussion about alternative methods of addressing risk.
Many of the nation’s most successful organizations have engaged Oxford to work in tandem with their advisory team to discuss the variety of risks they face and explore potential solutions.
The risk management conversation generally begins with the identification and quantification of all exposures, perils and hazards existing in the organization.
There Are Countless Examples of Risk that Many Businesses and Their Owners Are Exposed to, but Are Unlikely to Have Adequate Insurance Protection Against
Natural Disasters
Over the last decade, we have seen an alarming rise in economic damages and insurance claims due to a variety of natural disasters. Business interruption and loss of income are typically the result of such occurrences, yet most commercial property and casualty insurance policies may not offer protection from these causes of loss.
Cyber Fraud
We have also seen increasingly sophisticated and emerging forms of cyber fraud, which demonstrate how easy it is for a company to fall victim to this type of threat. Perhaps your client’s company could suffer losses from a denial of service attack, data breach or computer systems failure?
Property and Casualty
Commercially available property and casualty insurance policies often contain numerous coverage exclusions or limitations in the amount of eligible coverage. Difference in conditions coverage available through a captive program can be underwritten and priced to provide the specialty coverage(s) your clients need. Additionally, clients may be able to optimize the deductibles on their existing program for maximum overall premium efficiency.
Product Recall
Your client could be faced with a situation requiring product recall, resulting in significant expenses. Product recalls may be voluntary or involuntary in nature and may include the costs of notification of their customers, shipping, warehousing or disposal of recalled products. Standard policies will typically not provide coverage needed to address all of the potential costs associated with a recall.
Legal Defense
It is not uncommon for a company to find itself, its owners and management team embroiled in a situation requiring legal defense. Legal representation comes at a high price as costs for legal defense, paralegals, expert witnesses and other support staff add up quickly.
Damage to Reputation
Successful business enterprises, financial institutions, professional athletes and celebrities face a risk of loss resulting from damage to their reputations. Losses may include: lost revenue; contract cancellation; increased operating capital or regulatory costs; or destruction of shareholder value consequent to an adverse or potentially criminal event, even if the company or individual is not found guilty.
Supply Chain Disruption
Disruptions to a company’s supply chain can result in the interruption or cessation of business activities, product sales and potentially significant financial loss. Disruptions can be internal, such as a breakdown of vital machinery, or external, such as interruptions to the flow of raw materials or parts to the business.
Administrative Actions
Successful business enterprises face the possibility of financial losses due to administrative actions. Government investigations, legal action by federal or state prosecutors, or accusations by various states’ attorneys general can result in financial losses for even the best-run companies. Additionally, legislative or regulatory changes can have similar adverse financial impact.
Private Insurance Solution
A private insurance solution may very well be the most attractive option to address spiraling commercial insurance costs. It also can provide protection from risks for which commercial insurance cannot be obtained, and thus serve as an integral part of the organization’s risk management process.
Our underwriting experience across virtually all industry verticals allows us to efficiently gauge if an alternative risk transfer program could be of benefit to our clients without costly up-front charges. For example, clients paying significant premiums for excess liability coverage for which little or no claims have been paid, could add millions of dollars to their balance sheet by participating in a quota share captive. Shifting underwriting profitability from a commercial carrier to your private insurance company can generate enormous financial benefits for your company.
Clients look to their trusted advisors for guidance and advice. Their conversations should include an assessment of potential areas of weakness in the existing insurance program and undertaking proactive steps to address coverage gaps they face.
The discussion can begin with a simple listing of the events which can lead to unexpected financial loss and keep the business owner up at night. This information can provide a useful catalyst to further ongoing collaborative discussions with Oxford and the entire risk management team.