Tag Archives: Mike Meehan

Twice as nice: Milliman consultant named Captive Review Power 50 influencer

For the second year in a row Milliman’s Mike Meehan was named to the Captive Review Power 50 list. “Once again I’m humbled to be listed among Captive Review’s Power 50. Over the years I have been fortunate to have collaborated with a number of the folks on this list, and am further honored to be able to call a number of these folks good friends as well,” he said.

The Power 50 is a ranked list recognizing the 50 most influential professionals in the global captive insurance industry. See the full 2017 Power 50 list here.

In December, Mike was also named Captive Insurance Person of Interest by Captive.com. He’ll be a speaker at the upcoming Captive Insurance Companies Association (CICA) conference in Scottsdale, Arizona, in March. For more information, click here.

Milliman consultant makes Captive Review Power 50 list

Milliman’s Mike Meehan was named to the 2016 Captive Review Power 50 (subscription required). The Power 50 is a ranked list recognizing the 50 most influential professionals in the global captive insurance industry.

“I am honored and humbled to have my name included among this group, which contains so many individuals for whom I have the utmost respect,” he said about the distinction.

A.M Best recently interviewed Mike from the 2016 Cayman Captives Forum about the domicile’s captive market. He’ll be a speaker at the upcoming CICA Conference in San Diego from March 12 to 14. For more information, click here.

Adequate pricing for captive insurance takes communication

Actuaries and risk managers must communicate effectively when pricing captive insurance. Changes in coverage, operations and exposures, and loss control initiatives may require adjustments in premiums. Milliman consultant Mike Meehan provides some perspective in his article “Pricing for captives: Communication is key to getting it right.”

From an actuarial perspective, pricing a coverage for a captive often involves looking at the past experience of that coverage and adjusting the results to reflect inflation (for both losses and exposures), legislative changes, updated expense forecasts, etc. When a captive has been in business for a number of years, has a statistically credible history of losses, and is keeping the terms of the coverage consistent from year to year, this is a reasonable approach. Challenges arise when the captive has no credible loss history, when the risks that a captive is insuring are different or altogether new, or when the terms of the policy are different from what had been covered previously. In situations such as these, good communication becomes critical between the risk manager and the actuary that is involved in the pricing. This ensures that the pricing exercise is done correctly.

For example, consider a “Firm ABC” that had been purchasing professional liability coverage from the commercial market for a number of years. The terms of the policy have historically excluded coverage for asbestos-related claims. Firm ABC is now going to insure its professional liability claims through a newly established, wholly owned captive insurance company. The actuary pricing this coverage would typically rely on the historical loss experience of Firm ABC, assuming it has credible experience, or perhaps on industry loss costs used to price this type of coverage. If the actuary is not aware that there has been an expansion in coverage, namely the inclusion of asbestos coverage, the resulting premium could be inadequate.

This situation can work in reverse as well. Consider the same example, except now Firm ABC had been purchasing professional liability insurance that did include coverage for asbestos-related claims. If that same Firm ABC were to decide that it was now going to insure that coverage through a captive, however, and exclude the asbestos-related claims from coverage, then adjustments would need to be made during the rating process. Otherwise the premiums, based on loss experience or loss costs with provisions for asbestos-related claims, could be excessive. The risk manager, the underwriter, and the broker typically have the in-depth knowledge related to the subtle differences in coverages that aren’t necessarily identifiable by an actuary reviewing only loss runs. Communicating this information will help the actuary make sure that the necessary adjustments in the calculation of premiums are being made.

Meehan also participated in a recent panel discussion held by A.M. Best during the Vermont Captive Insurance Association’s annual conference. The discussion focused on some considerations that potential sponsors should think about if they decide to form a captive.

Milliman wins a 2015 US Captive Services Award

Milliman has received a 2015 US Captive Services Award, presented by Captive Review magazine. The awards recognize excellence and innovation in the U.S. marketplace. This article provides some coverage of the awards ceremony.

Here is an excerpt:

Milliman was able to demonstrate its leading position and experience in serving a broad captive marketplace. They have a large and strong captive practice allowing them to meet the demands of a significant client base. The Milliman submission pointed to specific examples of serving the wider captive industry in both educational and legislative activities.

Captive Review’s Lucy Kingston presents a US Captive Services award to Milliman consultants Mike Meehan (l.) and Joel Chansky (r.).

Evolution of captive insurance

Captive insurance has traditionally covered lines such as workers’ compensation, general liability, professional liability, and auto liability. More recently, captives have been used to underwrite affinity programs, employee risks, and cyber liability.

This Risk & Insurance article discusses the origins of captives and highlights companies that have helped make advancements in the industry. In the article, Milliman’s Mike Meehan offers perspective into the successful evolution of captive insurance.

Here is an excerpt:

Who has made this industry growth possible?

…“I think owners have been getting more and more sophisticated, primarily because the foundation has been poured by those that came before them,” said Mike Meehan, a consultant at Milliman.

“Essentially, for those captives that are just being formed, the options available to them at start up, both in what lines of business they will insure, and where they will domicile, have grown substantially.”

The rapid expansion of captives into the middle market – with owners tapping complex structures like pools and cells and even writing third-party risk to assist with IRS rules, as reported by many experts – can largely be credited to the hard work and innovation of the captive pioneers.

For more Milliman perspective on captive insurance, click here.