HUB International has launched a new cannabis benefits captive to function as an employee benefits group captive for cannabis organisations. The new captive of the global insurance broker and financial services firm, developed with Berkley Life and Health Insurance Company, is aimed towards cannabis clients and prospects seeking an alternative to traditional employee benefits programmes, in order to better reflect their employee profile. It will also allow them to exercise greater control over healthcare costs. Cannabis employers eligible for the new medical stop loss solution must have over 50 insured employees with a predictable cash flow and stable claims experience. As a variation of captive insurance, participants in an employee benefit group captive share the risk of expensive claims and back claims with their cash reserves and stop loss insurance, in order to have better control over costs and increased purchasing power. HUB notes this is an ideal solution for the cannabis industry because the demographic is perceived more favourably by carrier underwriters compared to the risks associated with other industries. Jay Virdi, chief sales office of HUB’s cannabis practice, explains: “The captive is for clients who desire greater control of their employee health benefits. If clients are looking for more flexibility, transparency, claims cost control, reduced fixed costs on health benefits, renewal stability or to gain market leverage, this captive strategy is right for them.”
