Corporate self-insurance

Many companies retain property/casualty insurance (P&C) risks, such as workers' compensation, general liability and medical malpractice, through insurance programs with large deductibles or other loss sensitive features or through qualified self-insurance programs. PwC actuaries help companies estimate retained liabilities for the corporate balance sheet, project future annual retained losses, and provide analyses that support risk management.

Potential issues

  • Retaining insurance risk for P&C risks, which may include workers' compensation, general liability, auto liability, product liability, or medical malpractice.
  • Building and maintaining appropriate support for retained insurance risk balance sheet accruals.
  • Understanding the key drivers of your self-insurance costs.
  • Accurately allocating self-insurance costs within the company to in order to promote accountability for controlling them.
  • Having or considering forming a captive insurance company.

How we can help

  • We have extensive experience helping companies with self-insurance related matters.
  • We understand self-insurance related accounting and audit issues.
  • We can tap related areas of expertise, including PwC's claims, risk management, accounting and tax professionals, to address a variety of issues, including captive insurance.

Our services

  • Actuarial analysis to estimate your indicated balance sheet liability.
  • Estimates of future self-insurance costs at different retention options to help with budgeting.
  • Allocation of self-insurance costs to operating unit.
  • Drilldown analysis to determine drivers of self-insurance costs, with the goal of better controlling costs.
  • Support for insurance company negotiations, including collateral requirements and buyouts of retained liabilities.
  • Reserving studies on your older workers compensation claims; we use our workers’ compensation pension model, which considers these claims on a case-by-case basis.
  • Actuarial support to help you determine the feasibility of forming a captive, including coverage limits.
  • Recommendations to improve your insurance program’s design and function.
  • Statements of actuarial opinion for captive insurance companies in U.S. and non-U.S. domiciles.
  • Review of your internal (or external) claims-handling procedures and processes in order to assess the reasonableness of staffing, reserving, case management and loss control.