Effective risk management can enable significant cost savings, better, more efficient production processes, and ultimately, long-term protection. In today's economic climate, risk coverage is essential to the health of mid-market organizations as they continue to grow in size and revenue.
As more prominent threats are analyzed and covered as part of a risk management program, hidden risks can also arise and they can be found in many industries, including oil and gas. In fact, businesses that work with petrochemicals are susceptible not only to the physical, tactical risks that stem from oil development and production, but also to changes in economic conditions. The demand for energy and petrochemicals correlates closely with general economic growth rates. The occurrence of recessions or other periods of low or negative economic growth will typically have a direct adverse impact on results. Other factors that affect general economic conditions in the world or in a major region, such as changes in population growth rates or periods of civil unrest, also impact the demand for energy and petrochemicals.
In the transportation and logistics industry, the operation of supply vessels, trucks and other machinery carry an inherent risk of catastrophic marine or land disaster, mechanical failure, collisions, and property losses to vessels or trucks, piracy, cargo loss or damage and business interruption. These risks can result in lost revenue or increased costs.
In healthcare, private hospitals and clinics carry patient safety risks including misdiagnosis, accidents in the operating room, and incorrect prescriptions.
Why a Feasibility Study Matters in Risk Mitigation
Every business has hidden risks inherent in its operations. An on-site feasibility study can determine true risks and provide insight into your risk management needs. It can also help determine eligibility for captive ownership. The feasibility study is used to design a plan of action and answer important questions surrounding policies and coverages. These questions include: Who will own the captive? What coverages are needed to fill the gaps in the client’s existing insurance policy? How will the captive fit into the overall financial structure of the businesses? True risk mitigation involves taking a first-hand look at hidden risks.
Capstone, in affiliation with The Feldman Law Firm LLP offer a dynamic alternative risk management solution which includes the insurance, tax, regulatory, and legal support needed to form a captive insurance company.
Owning a captive enables you to more efficiently finance risk exposures while transferring these risks to a separate entity. For business owners, this is a proven, more cost-effective choice than self-insurance or other insurance programs found in the marketplace.
Capstone offers a multi-disciplinary solution involving coordinated insurance, risk management, legal, accounting, audit, reinsurance, and regulatory services, in one comprehensive turnkey captive service package.