Self-Insured Retention (SIR) Programs
Self-Insured Retention—or SIR—is a classic risk financing strategy that is an effective cost savings tool, particularly for businesses with large risks characterized by high frequency and low severity claims. Companies with self-insured strategies in place have a greater degree of control over their risk management programs by establishing the amount of risk they are prepared to retain. Brunswick Companies can help you determine if a self-insured risk retention program is the right solution for you.
How Do SIRs Work?
An insurance policy written with a self-insured retention program has reduced premium costs and places the responsibility for claims handling, up to the amount of the retention, in the hands of the business entity rather than the insurance company. Claimants receive payments for claims handling, including defense, allocated expense costs, and indemnity payments, directly from the insured. Once the limit of the self-insured retention has been reached, the insurer takes control and handles the management of the claims.
Companies who choose a self-insured retention strategy have three options when it comes to management of the claims:
- The insured handles the claims themselves
- The insurer’s claim department retained by the insured assists with the claims
- Most often, a third party adjusting company manages the claims
By obtaining your Self-Insured Retention program through Brunswick Companies, you will have access to our claims management company, TransGlobal Adjusting. With over 30 years of experience, TGA is known as one of the top adjusting companies in the industry.
Self-insured programs that are managed properly can result in many benefits to the organization, especially when targeting areas that will have the biggest impact on cost savings and generate a higher return on investment. Although self-insurance is not the right answer for every company, it is an approach that should be strongly considered, particularly when the volume of claims are predictable or have an extended payout schedule. A self-insured retention strategy can also:
- Safeguard against the instability in the insurance market’s pricing and coverage
- Improve the company’s cash flow as no pre-funding of losses or large capital expenditures are required
- Add awareness, as the company is now spending its own money and safety within the workplace becomes a higher priority
- Support customization, selecting the services and expertise specific to the company’s industry
Brunswick Companies can help you design a self-insured retention program to best suit your needs today, and as your business evolves. We partner with clients, from small new businesses to fortune 1000 companies, offering expertise that is customized to your industry landscape. With the broadest range of products, we’re the only resource you need for complete protection.