Our Services

The range of services currently offered by SRS are detailed below. These professional services have been designed to offer you exactly what you need when it comes to risk finance and captive management operations. If you cannot find a particular service that you require, please talk to us - we might have the resources available to help you meet your business objectives.

Corporate Risk Management Consulting

  • Design and development of risk solutions
  • Development of risk management policies and operating procedures
  • Risk financing advisory services - self insurance involving the latest analytical and development techniques

Risk Retention and Risk Financing Studies

  • Risk retention studies, using Balance Sheet protection as the main driver
  • Determining risk appetite and linking this to the Self-Insurance / Insurance programme structure
  • Developing credible loss forecasting, using historical claims trends, used for:
    • developing Captive underwriting limits and premium requirements
    • determining Captive reinsurance requirements
    • stress testing the Captive solvency
    • developing cash flow requirements
    • preparing operating budgets
  • Utilisation of non-insurance risk transfer techniques (ART)
  • Providing cover for risks that are usually classed as "uninsurable"

Captive Feasibility Studies

The formation of an insurance company represents a major investment of time and resources. To ensure that the sponsoring shareholder achieves a satisfactory return, and that the insurance company adds value to the longer-term risk financing strategy of the group, it is essential that the fundamental issues are evaluated with precision from the outset. These are addressed in a Captive Feasibility Study.

Such a feasibility study focuses upon the financial implications and structure of the captive, against the background of the corporate profile and risk financing objectives. The objectives vary according to the organisation, but would generally include:

  • Reducing, or optimising, the overall cost of risk
  • Innovative product designs, and non-traditional insurance products
  • Minimising the transfer of funds to external (re)insurers
  • Maximising the profit gained from the organisation’s ability to absorb losses
  • Developing and marketing of insurance products to the organisations client base
  • Establishing a central record-keeping facility, to record all risk-related transactions of the group
  • Preparing a business plan that recognises the differing needs and desires of the organisation, its divisions and their respective shareholders

The study would recommend a structure which is consistent with the organisation’s risk-bearing capability and standard of risk management. The following aspects would be addressed in the feasibility study:

  • All aspects of the Insurance Act and statutory compliance
  • Level of statutory capital required at start-up, and the expected levels of statutory capital required in future years
  • Composition of the Board and management structures
  • Information on governance and risk management requirements
  • Level of maximum loss retention, risk appetite, and its effect on continued solvency
  • Reinsurance programme, to support both maximum foreseeable loss events and efficient capital management
  • Relative merits of alternative locations for the domicile of the captive, if available
  • Investment guidelines, within statutory requirements
  • Projection of financial results to demonstrate returns on capital invested, and levels of insurance reserving required
  • Company structure, set-up procedures and cost review

The structure of the entity identified during the study could be either:

  • a wholly-owned captive insurer (a subsidiary company) of the group, fully licensed in terms of the Short-term Insurance Act
  • a cell captive operation, via an appropriately registered insurance provider
  • some alternative structure that is compliant with existing legislation

Captive Management Services

Captive management services form the core service delivery of SRS, which form a natural progression from the Captive Feasibility Study to the day-to-day management of the structure identified during the study.

The captive management services of SRS include, among others:

  • underwriting of risks submitted to the Captive
  • reviewing retention levels of the Captive, in line with its risk appetite, and structuring reinsurance programmes to optimise the operation
  • general policy and premium administrative services
  • co-ordinating the acceptance or rejection and settlement of claims
  • day-to-day transactional banking
  • cash and investment management in accordance with statutory requirements
  • regular quantification and monitoring of statutory solvency margins and asset spreads in accordance with statutory requirements
  • regular financial record keeping using recognised accounting software
  • consolidated reporting to the group, as required by the parent company
  • preparation of management information, to allow appropriate business decisions
  • quarterly and annual reporting to the FSB and the Registrar of Insurance
  • preparation and co-ordination of the AFS and ST of the Captive, and facilitating the annual external audit thereof
  • where required, to assist with company secretarial, tax and VAT matters
  • convening meetings of the Board; and preparing meeting packs
  • attending regular meetings, and board meetings, of the Captive
  • South African Reserve Bank reporting and compliance
  • SARS reporting and compliance with respect to company tax and VAT
  • Facilitating Internal Audit to conduct their operations

Risk Information Management Systems

  • Design and implementation of insurance risk information management systems
  • Design and implementation of insurance risk data systems
  • Claims monitoring systems
  • In-house, network-linked and online facilities
  • Claims management and control systems

Actuarial Services

SRS is also well-placed to provide actuarial insurance services to both its Captive clients, and other clients requiring ad-hoc services. These actuarial services, include:

  • Historic claims analysis
  • Forecasts of potential future claims experience
  • Premium rating and reviews
  • Review of insurance liabilities, and appropriate insurance reserving
  • Monitoring of statutory solvency margins and asset spreads
  • Self-insurance and reinsurance optimisations
  • Business planning and forecasts

Sigma Risk Solutions (Pty) Ltd
Reg. No. M1993/004910/07
Authorised FSP License No.: 4348
FSP Representative: BC Wethmar
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