Edgewater offers a full range of actuarial services tailored to the needs of captive insurance companies, and in particular, group captives, including:
Pricing and Funding
Evaluation of funding requirements corresponding to targeted probability levels, assessing the impact of potential loss scenarios on funding, etc.
Loss Reserve Analysis
Loss reserve analysis can help captives set and achieve an appropriate level of reserves and provide an estimate of the captive’s ultimate and outstanding losses including IBNR (Incurred But Not Reported losses). Whenever possible, our analysis will utilize captive member companies’ individual historical experience for loss development and trending. Projections are provided at various confidence levels which integrate the statistical variability of actuarial estimates.
Loss Forecasting
Loss forecasting can help captives plan for the future and provide valuable insight for evaluating retention levels. Historical losses are utilized to develop projections of future loss experience including total loss amounts, frequency (number of claims), and severity (average claim size). The forecast typically provides a range of possible outcomes with respective probabilities. Providing a loss forecast in the context of risk helps our clients make more informed risk management decisions.
Retention
Analysis / Alternatives
Evaluating the costs and benefits of alternative retention levels helps captives to determine an optimal level of risk. As part of this analysis, we review and assess the captive owners’ appetite for risk, the captive’s current financial position, as well as the availability and cost of excess/reinsurance for risks to be transferred, all within the context of the captive’s goals and objectives.
Surplus/Capital
Adequacy Analysis
Risk assumption creates exposure to financial uncertainty since future outcomes are unknown. To protect against adverse developments, captives should maintain capital at levels commensurate with risk appetite. A surplus/capital adequacy analysis will examine whether the captive maintains reasonable levels of economic capital to support its current operations, and will also identify available capital to invest, grow the captive, and/or offer dividends. Custom risk scenarios can also be developed and analyzed and the appropriate levels of economic capital required to protect the captive indicated for each.
Other Services
Other services we provide include business planning, evaluation of proposed legislation, conducting educational workshops/seminars, conducting research on topical issues, and other special projects.
