Guidance on the Criteria Clients and Producers should consider when selecting their Fronting Business Partners

ACE USA, the U.S.-based retail operating division of the ACE Group of Companies, today announced that it has launched an audio podcast, or Internet-distributed program, on the abundance of traditional and nontraditional risk transfer options that are available to clients. The discussion is based on an article written by Ken Riegler, Executive Vice President, ACE Risk Management, “When Traditional Insurance Bests a Captive,” that was published in the January 2007 issue of Captive Insurance Company Reports. Additionally, Carol Frey, Vice President, Business Development and Client Retention, ACE Risk Management, offers comments stemming from her article, “Guidelines for Selecting Fronting Carriers in an Era of Change,” which was published in the April 2006 issue of U.S. Captive.

The podcast features a discussion by Ms. Frey and Mr. Riegler that explores the multiple challenges and considerations facing today's buyers when managing their own risks. Selecting an insurer to issue policies that will in turn be reinsured by a captive, or fronting company, should be carefully considered, and should transcend far beyond the simplistic approach in terms of price and collateral. Compliance, financial ratings and strength, as well as overall service and product capabilities and underwriting acumen are all critical to the evaluation process. ACE recommends a proactive, holistic and global approach to fronting carrier selection.

The podcast, one of an occasional series of audio podcasts that ACE USA has launched on selected risk management topics, examines how the market has evolved, what influences have triggered more participation in all types of risk financing products and how to sift through the myriad of options available to determine what’s right for each client. The podcast explores for the potential buyer and producer how the level of risk appetite should be considered with respect to short-term and long-term business objectives and the level of commitment required when considering an alternative market mechanism such as a captive.

“To succeed in today’s rapidly evolving environment, buyers of risk-financing products must carefully evaluate and determine their cost of risk and at what level they can participate in that risk in order to balance their risk appetite and risk transfer. Captives demand an extra level of evaluation as these structures require putting the buyer’s own capital at risk. The ACE Risk Management podcast explores a range of pertinent and timely selection considerations, and gives useful guidelines for matching the fronting carrier to the unique risk financing program," said Mr. Riegler.

To access the ACE Risk Management podcast audio program (approximately 30 minutes in length) featuring Ms. Frey and Mr. Riegler’s topical insight into fronting carrier selection, please visit www.ace-ina.com/podcasts. The material presented in the podcast is not intended to provide legal or other expert advice. It is presented for general information only. Listeners of this podcast should consult knowledgeable legal counsel or other experts with any questions. The above is only a summary; please see actual policies for terms and conditions.

ACE Risk Management offers comprehensive risk management programs and services that are uniquely designed and customized to assist companies in any industry deal with the significant costs of financing and managing risk. To learn more about ACE Risk Management’s products and services, visit www.aceriskmanagement.com.