Telecommunications Company with National Operations

A national telecommunications company generating $650 million in annual revenue and operating across more than 20 states approached Union Risk Services to explore alternative risk insurance solutions. The client was experiencing high and rising insurance premiums—and lacked control over underwriting, claims handling, and long-term pricing stability.

  • Industry: Telecommunications
  • Annual Revenue: $650 Million
  • Total Captive Premium: $7 Million
  • Lines Covered: Auto Liability, General Liability
  • Coverage Area: 20+ States Nationwide
  • Captive Structure: Single-Parent Captive
  • Captive Domicile: United States

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Challenges

  • Escalating Traditional Market Premiums: The company faced volatile renewals and limited negotiating power with traditional carriers.
  • Lack of Transparency: Minimal insight into claims management and reserve development.
  • Inefficient Use of Capital: Premiums were treated as sunk costs with no opportunity to retain underwriting profit or investment income.
  • Complex Multi-State Risk Profile: Operations in over 20 states required a compliant and scalable solution.

    • Union Risk Services Solution

    Union Risk Services structured a single-parent captive, domiciled in a U.S. onshore jurisdiction. This captive was designed to insure the company’s auto liability and general liability exposures. Key features of our approach included:

    • Feasibility Study & Risk Analysis: Conducted a comprehensive actuarial review, loss stratification, and jurisdictional compliance analysis.
    • Customized Captive Formation: Designed a captive with flexible capital requirements and tailored reinsurance layers to align with the client’s loss history and risk appetite.
    • Turnkey Management: Provided full regulatory filing, licensing, and ongoing captive management services.
    • Risk Control Integration: Delivered advanced risk engineering and claims oversight programs to reduce loss frequency and severity.

    Results

    ✔   Premium Reduction & Stability: Achieved over 30% in expected long-term savings through risk financing efficiency and reduced frictional costs.

    ✔   Profit Retention: Enabled the client to retain underwriting profits and investment income—capturing value that previously went to the traditional insurance market.

    ✔   Increased Control: Gained full control over claims management, coverage structure, and reserve setting.

    ✔   Strategic Asset: The captive is now a core part of the company’s enterprise risk management and financial strategy.

    Conclusion

    This case highlights Union Risk Services’ ability to deliver sophisticated captive solutions for large, multi-state businesses in complex sectors like telecommunications. By transitioning this client into a single-parent captive, we turned their insurance spend into a strategic financial asset—empowering them with control, transparency, and long-term savings.

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