A session at the Vermont Captive Insurance Association annual conference earlier this month had the audience chuckling and ended the conference on a light note.
Derick White, president of Strategic Risk Solutions Vermont, and former director of captive insurance for the State of Vermont, presented a workshop called “Toolbox Talk: Top 10 Ways You Know Your Insurance Company is in Trouble.”
The David Letterman-style presentation was fun and informative, especially at a time when risk managers—being grilled by their boards about the solvency of their insurers—are becoming detectives, looking way beyond ratings.
And so, without further ado, here is Derick White’s Top-10 list:
#8—Risk Based Capital is so low, it’s lower than half Len’s golf handicap! [Len Crouse is Vermont’s former deputy commissioner of captive insurance and evidently has a high golf handicap.]
#7—Company receives permitted practice to use white paper on its annual statement cover to save on yellow ink costs!
#6—The broker feels sorry for the company and returns his commission…so does the attorney!
#5—Schedule P loss triangles are now trapezoids.
#4—Board members double up at the Red Roof Inn for the annual meeting.
#3—Net Written Premium is greater than Gross Written Premium.
#2—Loss reserves are so far off that Bornhuetter has stopped talking to Ferguson [Bornhuetter-Ferguson method for loss reserving].
And the #1 way you know your insurance company is in trouble…
Schedule D lists scratch-off tickets!
