Zurich Insurance Academy: Multinational programs

Conducting international business is challenging, from an insurance and risk management standpoint. Challenges include: 

• Insurance coordination challenges: Multinational insurance programs need to be properly coordinated. Some companies want to ensure that coverages are consistent and standardized in all jurisdictions in which they operate. But the uncoordinated purchase of local policies subjects the organization to higher expense, gaps in coverage, inconsistencies in coverage and other problems. Another related issue includes the possible formation of global captives and pooling arrangements as vehicles to manage costs and enhance global risk management coordination. 
• Compliance challenges: A related issue involves ensuring that coverages purchased are compliant with local regulations and that premium taxes are properly calculated and paid. 
• Evolving regulations: Rules and regulations are changing rapidly and present major loss exposures. Failure to comply can result in fines, penalties and possibly even imprisonment for company officers. 
• Regional instability: Certain regions may be subject to significant instability due to political and economic conditions (e.g., the Middle East) or natural catastrophes (e.g., earthquakes in Chile, floods in Pakistan). 
• Current and emerging loss exposures: Companies doing business overseas need to be especially vigilant about current and emerging loss exposures associated with privacy breaches, trade credit worthiness of customers, supply chain vulnerabilities, and health-related concerns, as we’ve seen with the coronavirus global pandemic.  

This program reviews critical global insurance structuring programs, including Controlled Master, Freedom of Service and Financial Interest coverage. It also reviews the growing range of loss exposures and insurance coverage and risk management strategies designed to address these needs. To enhance the learning experience, participants will see how strategies are applied through the use of case study examples.

Outcomes

As a result of this training you will: 

• Identify the current and emerging risks faced by organizations operating globally. 
• Learn how a Controlled Master program issued in the United States, with local policies issued in countries in which the company operates, is designed and administered. 
• Learn how Financial Interest coverage is structured to protect the financial interest of a parent company when countries do not allow foreign carriers without a local license to provide coverage on a non-admitted basis. 
• Learn how Freedom of Service program structures can facilitate insurance coverage arrangements within the European Union.

Course duration
3 hours 

Continuing education credit 
3 credits 

Relevant industries 
All industries 

Overview

A captive is essentially an insurance company owned and controlled by the insured. Historically, captives were used to manage property-casualty risks. Since the 1990s however, captives have become increasingly popular tools for managing employee benefit programs.

The advantages of using captives to manage an employee benefit program include a) savings on premiums that would normally go to conventional insurance solutions; b) more effective risk management and health-related cost savings due to greater access to management information; and c) more control over the claims administration process.

Of course, the many advantages must be considered in light of the possible risks of an employee benefit captive, including compliance and regulatory risk, unanticipated losses, ineffective management, or claims administration problems, including potential employee complaints and dissatisfaction with the program.

This program analyzes employee benefit programs, reviews the advantages and disadvantages, explains how they’re structured, and under what circumstances they might be a suitable choice for a multinational corporation. The program will be of use to producers who are looking to help their clients manage the growing cost of employee benefit programs.

Outcomes

As a result of this program you will:

• Identify trends that are motivating a growing interest in employee benefit captives.
• Review the advantages and disadvantages of an employee benefit captive.
• Identify criteria that would make an organization a viable candidate for an employee benefit captive.
• Understand how to select an insurer for the program and optimize the captive fronting structure.

Course duration
2 hours

Continuing education credit
2 credits

Relevant industries
All industries

Overview

Companies of all sizes are doing business globally. Business success depends on agility and being able to pursue new markets wherever they are. But the potential rewards of global trade are also associated with risks. Different regions and nations have their own insurance rules and regulations that must be complied with. Failure to be in compliance can subject companies, distributors and carriers to fines, penalties and potentially even imprisonment. Further, complex insurance programs can get “lost in translation” with misinterpretations resulting in incorrect, inadequate or no coverage. All of these challenges can also confront the distributor with professional liability exposure. 

This course takes a case-study based approach to address these types of challenges, with cases focused on three types of challenges: compliance challenges; account management challenges, and issue resolution challenges associated with centralizing the administration of an international insurance program. Participants are assigned to teams to address each challenge and present their proposed solutions to the group for review and discussion.

Outcomes

As a result of this training, you will: 

• Understand the importance of developing insurance programs that are compliant with local rules and regulations.
• Understand how to structure a master policy that coordinates coverage for an entire transnational area, like the European Union. 
• Learn how financial interest insurance coverage can protect a parent company from losses suffered from subsidiaries and corporate entities operating in foreign jurisdictions. 
• Gain knowledge, deeper insights and “best practice” perspectives associated with the end-to-end international account management process.

Course duration
2 hours 

Continuing education credit 
2 credits 

Relevant industries 
Companies currently engaged in or planning to do business internationally

Overview

In the midst of the growing frequency and severity of data and privacy breaches around the world, more legislators and regulators are implementing and enforcing data security and privacy laws. The approaches have been different, depending on the region of the world. For example, the European Union has implemented data breach and privacy laws and regulations that cover the entire European Union. The United States, by contrast, has a wide variety of federal and state cyber security laws and regulations that are not necessarily consistent and often conflict. Some states are taking the lead in this area, including California, whose Consumer Privacy Act, signed in 2018, builds on the foundation established by the EU’s General Data Protection Regulation, and New York, which implemented SHIELD, its privacy protection law, in 2020.
Businesses must comply with data breach and privacy laws and regulations in all of the jurisdictions in which they operate – domestic and international  – and this may require different approaches and standards for each region. This program reviews the laws and regulations in effect, as well as under consideration, and strategies for complying with them.

Outcomes

As a result of this course, you will:

• Identify trends in privacy legislation and regulation and why such developments are increasing.
• Understand how businesses may be inadvertently exposed to privacy laws in the U.S. or abroad to which they may not be aware.
• Learn strategies businesses can use to help comply with existing or prospective privacy laws.

Course duration
2 hours

Continuing education credit
2 credits

Relevant industries
All

Overview
Directors and officers of multinational corporations are facing growing challenges, as various stakeholders (shareholders, customers, suppliers, regulators, etc.) aggressively seek to broaden the definition of “wrongful acts” that may make those directors and officers accountable. Litigation is being targeted at companies for a broad range of issues, including declines in value of share prices, cyber breaches, supply chain disruptions, environmental damage and, lately, alleged failure to adequately prepare their company for the economic devastation caused by the pandemic. It used to be that management liability exposures were most pronounced in the United States. That is no longer true, as overseas courts and jurisdictions are increasingly holding directors and officers accountable.

Litigation against directors and officers can be expensive, time-consuming, involve months of uncertainty while litigation plays out, and result in damaged reputations, potentially massive personal financial liability and, in worst case scenarios, imprisonment for failure to comply with local regulatory or legislative mandates.

The design and implementation of an effective and comprehensive Directors and Officers (D&O) insurance program is extremely complex. Issues related to adequacy of coverage, cost, the coordination of admitted and non-admitted policies, which policies will pay under what circumstances, and related tax consequences are all significant.

In this course, we will review how D&O programs can be designed to address a broad range of circumstances and challenges. Effective design is not only critical for protecting the corporation and the individual directors and officers, it is also crucial for attracting the best executive talent. Quality executives are increasingly insisting that these programs be adequate to protect their personal and career needs as a condition precedent to them agreeing to take employment or serve on a board of a multinational corporation.

Outcomes
As a result of this program, the participant will:

• Learn how an international program with a U.S. master D&O policy can be coordinated with locally admitted D&O policies, where insurance laws prohibit non-admitted coverage.
• Analyze the impact and effectiveness of multi-insurer D&O towers to address large exposures.
• Review scenarios where coverage may be inadequate, due to non-compliance with international regulations in local jurisdictions or because a claim in a local, foreign jurisdiction erodes the U.S. tower limit, potentially leaving U.S. directors and officers without protection.
• Identify best practices for designing, implementing and servicing globally compliant and effective international D&O programs.

Course duration
2 hours

Continuing education credit
2 credits

Relevant industries
All industries

Contact us for more information:

Bart Shachnow CFP®, CLU, ChFC, CPCU
Director, Zurich Academy Training Programs
917-534-4637
bart.shachnow@zurichna.com

Overview

A distributor has bound an international account. Mission accomplished, right? Actually no. International insurance programs are extremely complex and require ongoing monitoring and vigilance to ensure that coverage objectives are accomplished and international insurance rules and regulations are complied with. 

Conflicting regulatory regimes, tax issues and corporate governance activities all present complex account management problems. For example, with regard to claims, if a loss occurs locally, can the local subsidiary retain local counsel to defend itself in a lawsuit as well as local loss control experts (including engineers and medical experts) to help adjudicate a claim? The answer cannot necessarily be answered yes. With regard to taxation, does a local claim need to be paid in-country? If the global policy cannot pay a local claim, would payment to the parent expose the parent to taxation in its home country? Concerning Certificates of Insurance, would failure to provide evidence of locally obtained insurance trigger breach of contract exposures for a parent company?

This program reviews the major issues involved in managing the international account on an ongoing basis and provides optimal strategies for monitoring and managing these accounts so that risk management and insurance objectives are accomplished. 

Outcomes

As a result of this training, you will: 

• Identify critical insurance and risk management program set-up and structure that need to be communicated to affected business units involved in the global program.
• Identify issues that require regular monitoring and updating in order to optimize account management objectives. 
• Identify what information needs to be reported, to whom and when, in order to optimize decision-making. 
• Learn best practices for organizing and managing an international risk management and insurance team. 

Course duration

2 hours 

Continuing education credit 

2 credits 

Relevant industries 

Companies currently engaged in or planning to do business internationally 

Overview
Many industries are subject to cyclical conditions, which can favor the industry in “up” markets and penalize it in “down” markets.

The property-casualty industry is similar, and its ups and downs are referred to as soft and hard market conditions, respectively. This course explains how insurance market cycles work, and the characteristics of each. We explain how distributors can help businesses best manage the hard market and employ tools that may enable the insured to secure coverage on more favorable terms and conditions.

Outcomes
As a result of this training you will:

• Understand the impact and influence of general economic trends and developments on conditions in the insurance market.
• Identify characteristics of, and factors that cause, a soft or hard market.
• Learn strategies distributors can use to help their customers and their own agencies survive and prosper even in the most difficult hard market conditions.

Course duration
2 hours

Continuing education credit
2 credits

Relevant industries
All

Overview

International insurance programs can be extremely complex and demanding in terms of compliance issues, coverages, coordination and integration with local insurance laws and regulations, costs, and ongoing servicing and administration. 

In this program, participants have an opportunity to engage and interact in a business simulation that requires them to analyze the needs of a hypothetical manufacturing company named Titan Industries. 

During the course of the simulation, participants are grouped in teams and confronted with multiple events that will impact the design, implementation, execution and administration of Titan’s international insurance and risk management programs. As events unfold, teams must select the “best” or most optimal alternative from multiple options and then justify the selection as they balance a number of often conflicting demands. 

One of the main objectives of the simulation is to demystify what the insurer is doing when presenting, underwriting, structuring and servicing an international insurance and risk management program and to understand how that process works from beginning to end.  All producers working with customers who have global operations will benefit from this intensive, comprehensive, hands-on learning experience. 

Outcomes

As a result of this training, you will:

• Compete against other teams to formulate a globally compliant insurance and risk management program.
• Develop awareness about the factors that may help ensure or might impede successful program implementation.
• Identify important insurance program structuring strategies, including use of master policies in coordination with local policies, and Difference in Conditions/Difference in Limits strategies designed to provide comprehensive coverage and prevent coverage gaps.
• Learn how the entire process of presenting, underwriting, structuring and servicing an international insurance and risk management program works from beginning to end.

 
Course duration
3 hours 

Continuing education credit
3 credits 

Relevant industries
All industries that currently have, or are contemplating, international operations.