Management Consulting
Aon
Full Credential Description
A large food and beverage client with two captives sought to renew their insurance program and inquired whether their structure could be optimized for efficiency. Aon conducted a market analysis and an actuarial review for each line of business using Risk Financing Analytics (RFA). This involved modeling the impact of changes in expected losses and cost of capital to identify the most efficient program structure. As a result, the client increased their retentions, achieving an initial 4% reduction in premium, followed by an additional 13% annual cost reduction based on the newly identified efficiencies. In another case, a consumer goods client, under the direction of a new CFO, aimed to evaluate their insurance program with an independent, data-driven perspective on risk tolerance. Aon performed an RFA exercise that encompassed property damage, business interruption, private placement life, and marine insurance, including assessments of natural catastrophes. The analysis estimated the client's tolerance for unbudgeted loss and established a framework for optimal insurance purchasing. This led to reduced volatility and a clearer understanding of the market regarding their total cost of risk, ultimately resulting in a 5% reduction in annual premium costs.