Insurance service provider Charles Taylor has announced the launch of an innovative Insurance & Asset Protection Program for Latin American Small and Middle Sized Enterprises (SMEs), designed to help cover catastrophe deductibles.
The programme offers SME’s immediate insurance payment for deductibles, the option of building up US Dollar reserves to protect against local currency devaluation, and the insured’s self-ownership of Bermudian captive cells.
Alvaro Ortiz, President and Chief Executive, Charles Taylor, Panama, said; “Policyholders can protect their businesses from an insurance payment shortfall at the same time building up US Dollar reserves, protecting them from potential currency devaluation in their own country. They can also retain control of their US Dollar assets built up in their captive cell to reinvest back into their business.”
Charles Taylor’s scheme provides insurance via a captive insurance segregated cell company in Bermuda.
As part of the programme, policyholders own their own captive cells, including all premiums built up in the insurance company, and so are subject to less fees and operating expenses.
Ortiz explained; “A major earthquake or other natural disaster could leave SME businesses in Latin America struggling with depleted cash flows after covering full catastrophic deductibles.
“Our new program is designed to replace that cash flow and enable these SME clients to continue their profitable operations.”
While the scheme will see Latin American SME’s depositing their most risky catastrophe exposures into captives, likely self-funded, it also reflects an opportunity for reinsurance to provide coverage for a portion of these high risk layers of corporate risk.
