Insurance

Insurance Company Consortium - Shared Liability and Reinsurance Decisions

Every year, the consortium members have to decide how much liability they will pay for individually, how much liability to share as a 'club', and how much to reinsure outside the club. The best outcome may be different for each company in the consortium. How does the group set thresholds for risk?

Oxford Risk:

• Identified key drivers of the group's decision-making process.
• Mapped areas of conflict and cooperation between the companies.
• Identified the risk attitudes and preferences of the individual companies, and communicated them to the decision-making committee to make future decisions more transparent.

The benefit was a more balanced approach that allowed the individual members and the group to get closer to their preferred risk thresholds, thereby maximising the potential reward opportunity for each.