Research

Multinational Pooling and Benefit Captives Research Report 2016/2017

Unlocking potential: global approaches to benefit financing

March 1, 2017

For multinationals, the annual costs of employee health and risk benefits, including medical, life and disability protection, are enormous. Global benefit leaders must manage these long-term costs if their companies are to remain market competitive in to the future.

The Willis Towers Watson 2016/2017 Multinational Pooling and Benefit Captives research report explores the way companies use multinational pooling and captive arrangements to unlock cost savings, and answers many of the questions commonly asked by global benefit leaders, and increasingly by risk managers about these approaches.

Profitability of multinational pools and captives, expressed as a percentage of pooled/ reinsured premium

Profitability of multinational pools and captives, expressed as a percentage of pooled/ reinsured premium

The study, probably the largest of its kind, uses pooling and captive data from over 1,500 annual reports submitted by more than 200 multinational companies. These reports encompass more than US$6 billion in premiums across 118 countries and all participating benefit plans, including life, accident, disability, medical and some retirement plans (e.g., risk-related elements, such as spouse or orphan benefits). Key findings from the analysis show:

  • There are significant cost-saving opportunities for many companies in return for them taking a more proactive and considered approach to the management of their insurable benefits
  • Multinational pooling and captive arrangements deliver cost-savings for companies
    • Well-managed pools can achieve savings of 15% or more
    • Well-managed captives can achieve savings of 25% or more but incur additional costs to maintain
  • Employee Benefit captives are now an established part of the insurable risks financing landscape
  • There are wide variations in profitability based on geography and coverage types
  • Keys to achieving sustained success include defining, communicating and executing a global benefit financing strategy
Pooling dividends received split by pool type

Pooling dividends received split by pool type

As specialists in this field, Willis Towers Watson experts can draw from their deep knowledge of the complex legal, accounting and regulatory factors to assist clients with all elements in managing multinational pooling and captive arrangements.

How to participate? All you need to do is send us an email with copies of your last three years of annual pooling or captive reports. If you do not have copies of all your reports at hand, please email us your authorization and we will contact your pooling/captive networks on your behalf.

In return for participants sharing data with us, we provide participants only with complimentary bespoke benchmarking data on:

  • Your pool’s/captive’s overall financial performance compared to others
  • Your pool’s/captive’s financial performance by country and line of business (life, medical and other)
  • Your claims experience (life, medical and other) as a percentage of premium in your main countries of business and how this compares to others
XYZ compared with all pooling participants' average dividend (sample participant bespoke data)

XYZ compared with all pooling participants' average dividend

The full report is available via the Download link.