Managing your employee benefits costs and risk
If you’re a global organisation, we can help you implement multinational pooling to combine the employee benefits contracts of your subsidiaries around the world into a centralised account, to potentially obtain a dividend and unlock the power of risk-spreading.
How does multinational pooling work?
Multinational pooling is available to all companies that have operations in two or more countries, regardless of their overall size. It is provided by networks of insurance companies (the members) that cooperate together to enable multinational companies to utilise their economies of scale.
Employee benefits in a pool are insured by the members of the network as normal, so there is no change to the local terms and conditions of the insurance policies. Each year, the insurers provide the network with information on the premiums and claims paid, plus the expenses they and the network incurred, which are then combined together into an account. This account is used to establish if there is a surplus, commonly known as a ‘dividend’, which is then paid back to the company.
What are the cost benefits to multinational pooling?
There are no additional charges or loadings applied to the premiums paid for the employee benefits. Although a dividend is not guaranteed as it is subject to the claims experience, which cannot be predicted, when adding a local employee benefits plan into a pool is a consideration the network will provide an illustration to indicate the potential dividend. The pool may also provide a higher level of free cover or guaranteed issue than that offered locally, removing the need for some or all of the required medical underwriting.
Why choose NFP?
Global expertise and unrivalled client service
The wealth of knowledge held by our team of international consultants includes over 25 years of experience in managing pools. Our in-depth knowledge and experience ensures that not only do you have exactly the right pooling system to suit your business needs, but also active pool management to maximise results - liaising with the pooling network, their members and the local brokers, to proactively expand the pool.
We are a broker-agnostic international consultancy, in that we do not require local appointments for NFP practices and our partner firms around the world. However, we can introduce local brokers for your subsidiaries to appoint where required. This ensures as little disruption to local relationships as possible, while still achieving the desired results and coordination of management information from pooling.
Bespoke solutions, driven by data
With several networks to choose from, we’ll conduct an analysis of the most appropriate network, taking into consideration the opportunity for a convenience or natural pool (where a number of eligible employee benefit plans are already insured with the members of a particular network).
We’ll also look at the countries in which the networks have members, in comparison to the countries in which you have subsidiaries. Our recommendations will take into account the minimum criteria in terms of premiums and headcounts (in total and per country) for each network, as well as the free cover level or guaranteed issue offered by the networks. Finally, we’ll take into consideration the competitiveness of the insurers and the expenses and potential dividend from the pooling illustration.
Regular insights and enhancements
We’ll provide regular reports and a flow of insights that allow us to work with you to monitor and control costs, claims and benefit levels. Your consultant will provide an analysis of the annual report and performance, overall and per contract, to ensure that the contracts included in the pool are profitable and, if necessary, recommend a switch to a different pooling system, which can be undertaken on an annual basis.
We’ll actively develop the pool by ensuring that the potential to pool is taken into account when market reviews are being undertaken, by generating awareness of the opportunity with the stakeholders at your corporate headquarters and the decision makers at your subsidiaries, and by liaising with the appointed broker, pooling network and their network member.