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Benefit financing

The annual cost of providing employee health and risk benefits on a global scale can impact significantly on multinational P&L accounts. Global benefit leaders must manage these long-term costs if their companies are to remain market competitive.

The use of captives and multi-national pooling to finance insurable employee benefits has now become an established and popular strategy to control benefit costs amongst multinational companies.

By promoting a more proactive and considered approach to the management of insurable benefits, both options offer significant cost-saving opportunities for global employers:

  • Well-managed pools can achieve savings of 15% or more
  • Well-managed captives can achieve savings of 25% or more (but incur additional costs to maintain)

The Willis Towers Watson 2016/2017 2018-Multinational-Pooling-Matrix-report explores the way companies use multinational pooling and captive arrangements to unlock cost savings.  The study, probably the largest of its kind, uses pooling and captive data from over 1,500 annual reports submitted by more than 200 multinational companies. It answers many of the questions commonly asked by global benefit leaders, and increasingly by risk managers about these approaches.

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Multi-national pooling

Spreading global benefits risk to minimise costs Employers with a multinational presence can often leverage their global purchasing power to…