Authors: Joe Filby Susan Wright

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Some businesses that historically relied on traditional insurance models are now responding to rising premiums and decreasing coverage by absorbing some manageable risks. Retention financing programs (RFPs) can help these businesses protect against the downside of retaining risk. RFPs offer budgetary certainty and a potential financial upside through profit-sharing when losses are lower than expected. RFPs are multi-year contracts that combine risk transfer and funding, providing cash flow stability and potentially covering uninsurable risks.

In this whitepaper, we explore how RFPs can help businesses take control of their retained risks, optimize capital deployment and build financial resilience to navigate today's increasingly complex risk environment. The paper also notes alternative risk management options like captive insurance and deductible buy-down policies, each with its own challenges.

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The information contained herein is offered as insurance Industry guidance and provided as an overview of current market risks and available coverages and is intended for discussion purposes only. This publication is not intended to offer financial, tax, legal or client-specific insurance or risk management advice. General insurance descriptions contained herein do not include complete Insurance policy definitions, terms, and/or conditions, and should not be relied on for coverage interpretation. Actual insurance policies must always be consulted for full coverage details and analysis.

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