By: tripointins On: July 18, 2016 In: Performance Based Insurance Comments: 0

How does the Performance Based Insurance (PBI) model differ from the Subsidy Based Insurance (traditional insurance) model? The Performance Based Insurance model requires little or no subsidy to the insurance carrier – it works like this. All companies pay a fixed premium that’s used to run an insurance company....

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Let’s begin with some simple definitions. Subsidy-Based Insurance (SBI) is traditional insurance, insurance coverage where the carrier keeps about 35% of your premium and your business is thrown into a pool of other unknown business, often with a mixed if not problematic loss history. Your rate is determined by...

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Performance Based Insurance focuses on the long term, a comprehensive safety strategy, controlling premiums swings, paying for small losses and insuring for the unlikely severe loss. Many companies will see annual savings of 25% to 50%, while maintaining dramatically improved control over their cash flow and premiums. Simply said,...

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By: tripointins On: July 5, 2016 In: Performance Based Insurance Comments: 0

Modern insurance began in London and exploded globally from Edward Lloyd’s coffee house in 1688. It’s now known as Lloyd’s of London. Ship owners would meet at Lloyd’s and discuss their voyages. They realized the value of their cargo was great enough that it would be catastrophic to lose...

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Performance Based Insurance offers a compelling ROI for many companies, and will transform the insurance landscape in the coming decade. Safety conscious companies will typically reduce their insurance premiums 25% to 50%. The best in class performers can reduce premiums more than 50%. Let’s look at an ROI scenario...

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By: tripointins On: June 13, 2016 In: Performance Based Insurance Comments: 0

Companies using traditional insurance, also referred to a Subsidy Based Insurance (SBI), encounter all of the following problems: Subsidize your unsafe competitors No control of your insurance destiny Subject to unpredictable market swings Insurance company earns the financial rewards Constantly out to bid to keep system honest No underwriting...

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In the past, we’ve discussed some of the major problems caused with Subsidy Based Insurance (traditional insurance). Here is a list of some of the major advantages of Performance Based Insurance: Little or no subsidy to others Control your insurance destiny Eliminate unpredictable premium swings You earn the financial...

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By: tripointins On: May 18, 2016 In: Performance Based Insurance Comments: 0

A few hundred years ago, when insurance was “invented” in Edward Lloyd’s coffee house (now known as Lloyd’s of London),  ship owners sat over coffee and decided how they would share risk. Essentially, a mini-insurance company was formed for every voyage. Imagine if a ship owner or its captain...

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By: tripointins On: May 18, 2016 In: Performance Based Insurance Comments: 0

Middle market companies can learn a lot from the Fortune 500. For example, from our perspective the Fortune 500 separates the world of insurance into two categories: Subsidy Based Insurance (SBI) and Performance Based Insurance (PBI). There is a big difference between these two categories. When it comes to...

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