medTRANS Insurance, Ltd

Captive Insurance

How to get started: 

1. Please visit http://www.medtransltd.com/savvik/ today!

Or, Contact Phillip Holowka by email at phil@medtransltd.com or dial 412-847-0748 (office), 724-612-4995 (cell).

2. Be sure to mention your Savvik Number (top right hand of the Savvik page underneath your welcome), to get the discounted pricing

even medTRANS has a Story!

medTRANS Insurance Ltd. has been operating as an affinity group owned insurance company since 2010. In 2015 medTRANS was redomesticated from Delaware to North Carolina.

Since inception and continuing through September 30, 2016 medTRANS has reinsured medical stop loss policies fronted by various commerical stop loss carriers. The fronted insurance program is referred to as the medTRANS 1.0 program, or simply medTRANS 1.0.

The medTRANS business model eliminates the need for a fronting company to issue medical stop loss policies. In place of a fronting company, protected cells issue stop loss policies directly to employers. Each cell cedes its risk and premiums to the protected cell captive insurance company (the core), which in turn retrocedes pooled risk and premiums back to the various cells. Although this architecture is already commonplace for captive insurance arrangements that cover property/liability risks, this architecture is novel for covering medical stop loss risk. Other captive insurance arrangements that insure medical stop loss risk are sponsored by commercial insurers with their own profit motives, whereas medTRANS steers the profits back to the members.

  • The core retrocedes pooled underwriting profits to the cells on a 24-month initial cycle, then each year thereafter. This approach enables the employer to self fund its employee medical benefits plan to the largest extent that is practical while still enjoying liquidity benefit of protection from the occasional shock of an adverse specific stop loss claim or an aggregate stop loss claim.
  • The core is member-owned but is not a mutual insurance company; members are shareholders. As shareholders, they contribute the risk capital that backs the medical stop loss underwriting, and they also participate in the earnings of medTRANS that are not otherwise retroceded to the cells.
  • Cells are able to cover more layers of risk than are pooled by the core. For example, a cell could write stop loss insurance at a $25,000 specific attachment point yet cede such risk at a $50,000 attachment point, thereby financing more risk of the employer without incurring the transaction costs of pooling it.
  • Cells may issue property/liability coverage types in addition to medical stop loss. The operating business that is affiliated with the cell may want the cell to finance other uninsured risks of the operating business.
  • Membership is made easy by offering each member the flexibility to fund required capital with a variety of instruments: accumulated surplus, surplus notes loaned to the core, shareholder loans borrowed from the core, or stock subscriptions in exchange for capital contributions. This flexibility allows the core to cater to new members case by case.
  • Expense ratios for administrative and sales and marketing expenses are capped at levels that are competitive with commercial insurers. Expense ratios in the medTRANS model reflect greater efficiency than exists within typical captive management service engagements.

What is captive Insurance?

A captive insurance company is a licensed and regulated insurance company owned by a business (or individual) in which issues various insurance polices to it’s owner.   In SIMPLE ENGLISH, when you’re a business owner and you need to cover risks to your business, you either buy a commercial policy from a commercial carrier, or you can pay premiums to your captive to protect your business against those risks.

Common Advantages to captive Insurance?

Lower Insurance Costs

Insurance premiums must be adequate to meet claims demands which is #1 priority for ALL INSURANCE Co.  In addition, much like a commercial carrier, a captive insurer is also in the business of being profitable.   The big difference between the two is a commercial carrier inherently has cost centers captives do not have, such as acquisition/marketing costs, overhead and profitability requirements to satisfy shareholders (not policyholders).

Cash Flow

Commercial carriers rely heavily on investment income.  Premiums paid are likely paid well in advance of claim payments which may or may never occur.   The time between a claim being incurred and paid could be as early as 60 days to 6 months or more.   Therefore, the business advance funds a risk and allows the insurance company to earn investment income on those funds.

Risk Retention

By having lower embedded expenses, the captive is able to offer a greater level of protection to the business because it can purchase more coverage; if that is the desire of the business.

Customized Coverage

When the commercial market is unwilling or unable to provide coverage, the business is left to self-fund that risk.  By self-funding a risk is not always the best accounting solution.   A captive can issue policy types for certain risks the business is self-funding today, or, maybe a commercial policy does not cover or excludes a certain type of risk from a common policy.  The captive can cover these commercial policy gaps as well.

Risk Management Focus

When a business is involved in a captive, it’s economic interest tends to shift toward mitigating the risks of the business, WHY, because if the business can effectively prevent a risk from occurring, it stands to financially gain by lowering insurance costs.   In other words, if you pay a commercial carrier $100,000 premium and have no claims during that policy year, it’s not likely you’ll see any of the $100,000 in the following year.   With a captive, if you pay $100,000 premium and have no claims, you will have insurance company underwriting profits.

Underwriting Benefit over Time

A common expression within captive insurance is 2 out of 5 years will be more costly then expected.   But, over a 5-10 year period, the unit cost of insurance can and will decrease by way of underwriting profits earned by the captive.   With medTRANS, our unique structure allows members to realize underwriting profits faster then traditional group captives.


What is captive Insurance, in simple ENGLISH
A captive insurance company is a licensed and regulated insurance company owned by a business (or individual) in which issues various insurance polices to it’s owner.   In SIMPLE ENGLISH, when you’re a business owner and you need to cover risks to your business, you either buy a commercial policy from a commercial carrier, or you can pay premiums to your captive to protect your business against those risks.
What is captive Insurance, in simple ENGLISH
A captive insurance company is a licensed and regulated insurance company owned by a business (or individual) in which issues various insurance polices to it’s owner.   In SIMPLE ENGLISH, when you’re a business owner and you need to cover risks to your business, you either buy a commercial policy from a commercial carrier, or you can pay premiums to your captive to protect your business against those risks.

Risk Management Focus

When a business is involved in a captive, it’s economic interest tends to shift toward mitigating the risks of the business, WHY, because if the business can effectively prevent a risk from occurring, it stands to financially gain by lowering insurance costs.   In other words, if you pay a commercial carrier $100,000 premium and have no claims during that policy year, it’s not likely you’ll see any of the $100,000 in the following year.   With a captive, if you pay $100,000 premium and have no claims, you will have insurance company underwriting profits.

Member Details:

Vendor:  medTRANS Insurance, Ltd

Product/Service: Captive Insurance

Service area:  United States, Canada & Internationally

Available to:  All current Savvik members

Current Contract Ends:  Ongoing

Contract Number:  SVBA091418

More Information:

For more information or to place an order, please contact:

medTRANS Insurance, Ltd

Phillip Holowka

Corporate Assistant Secretary

706 Rochester Rd

Pittsburgh, PA 15237

412-847-0748 (office)

724-612-4995 (cell)

412-369-9990 (fax)

phil@medtransltd.com

http://www.medtransltd.com/savvik/

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Be sure to state that you are a Savvik Member and provide your Savvik Member Number

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