Willis Towers Watson (WTW) has launched the Homestead Insurance Company Incorporated Cell (Homestead), a group captive solution designed for upper middle-market companies.
Homestead will reinsure The Hartford, which will issue admitted insurance policies to members selected for this group programme.
The programme aims to provide companies with a better and more cost-efficient way to purchase insurance over a five-to-10-year period while eliminating the peaks and valleys of the standard market and giving members ownership of their underwriting profit otherwise retained by an insurance company.
According to WTW, an individual member’s results will be directly related to its loss performance along with the group’s shared experience collectively.
Homestead said it will offer “value to its members” through up-front premiums that should be competitive with traditional market programmes and long-term cost that will be significantly lower than traditional programmes if members maintain good loss experience.
The programme also aims to provide opportunities for additional savings through dividends, greater impact and efficiency in the handling of claims, and control over all administrative decisions of the group programme.
Homestead will add value by providing true insurance for adverse losses from The Hartford, avoiding the cost and time commitment involved in either a single-parent captive or traditional group programme.
Jim O’Connor, head of middle market and specialty broking, WTW, said: “I’m thrilled to expand on our current middle market solutions with Homestead.”
O’Connor added: “Homestead is another valuable risk transfer option, in addition to our industry-specific Differentiated Broking Solutions strategy, that provides unique advantages to our clients beyond standard risk transfer.”
“We’re excited to partner with Willis Towers Watson on this captive solution,” said Mo Tooker, head of middle and large commercial at The Hartford.
“We understand the needs of midsize businesses and how critical it is to take a flexible and consistent approach in managing risk to create better economic outcomes for clients,” Tooker noted.
