Advisory and broking firm, WTW, has introduced its new Structured Auto Buffer London Excess (StABLE) facility as a risk financing solution that utilizes ‘Swing Plan’ structures, designed to assist organizations in managing fleet-related risks while offering potential rewards for effective risk management and positive loss performance.
The StABLE facility allows clients to share both risk and potential rewards from their fleet operations. If losses remain below a predetermined threshold, clients may receive a portion of the premium back, with an option to commute the policy for further returns.
However, if losses exceed this threshold, additional premiums are capped, offering a balanced approach to risk sharing. Clients also have the flexibility of tailored terms, including adjustments to premium structures that can support cash flow. In cases where limits are exhausted, there are options for policy reinstatement.
The solution responds to concerns among fleet operators who, despite investing in safety and telematics systems, are not experiencing a reduction in premiums from carriers.
WTW’s new product aims to offer a degree of protection against broad portfolio pricing and to give clients more budget predictability over multiple years. The structure defines limits on potential losses, helping to create a more transparent budgeting process.
James Sallada, head of casualty North America at WTW, emphasized that the StABLE facility provides a new approach to risk-sharing, particularly as capacity in the market becomes more restricted and expensive.
“The facility is yet another example of WTW’s client-focused broking specialization, and it enables our team to quickly offer the broadest available terms and conditions, which can be tailored to meet specific balance sheet priorities for clients,” said Sallada.
The StABLE facility is aimed at clients operating large or heavy fleets, including vehicles such as trucks, buses, and construction vehicles. These clients span several industries, including delivery, construction, waste management, and public transport.
Jon Drummond, head of broking and transportation and logistics industry leader for WTW North America, highlighted the need for risk financing structures to evolve alongside the increasing complexity of casualty risk.
“This unique solution extends leverage to clients and allows them to optimize their capital spend to better control the total cost of risk in an inflationary environment, particularly concerning premium spend and loss costs,” said Drummond.
Read more about WTW’s sustainability initiatives here.
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