Zurich's Foreign Casualty Services Aid Multinational Corporations

Multinational corporations with locations in multiple countries face numerous risks from the various cultural, legal and political environments that make up the global marketplace. An area of particular concern is foreign casualty insurance coverage. Companies with numerous locations and multiple policies could be at risk for serious coverage gaps, overlaps and inconsistencies.

The need for global consistency, especially in the casualty lines of business, is particularly important. Zurich Global Casualty is working closely with its multinational customers to address a broad range of foreign casualty needs, including general liability, products liability, workers' compensation, multinational auto fleet coverage and Defense Base Act (DBA) coverage.

As one of the world's largest providers of insurance and related risk management services to multinational corporations, Zurich offers a network of owned locations, direct allies and indirect alliance companies with capabilities in more than 180 countries. The company routinely creates master programs that assist multinational customers in helping to gain greater control of the coverages and costs of their risk management program structures.

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Zurich recently worked with a multinational client looking to consolidate its fleet coverage in order to create a more coherent master program. The customer, a large corporation providing a broad range of industrial products and services--from sophisticated security and fire suppression systems to flow control and electrical supplies--wanted to consolidate a patchwork commercial fleet program in 16 individual countries. While the customer had already placed some domestic U.S. lines of business with Zurich, the commercial auto fleet program was new to the insurer.

Zurich won the program based on its well-established multinational network and capabilities, as well as its ability to provide local representation in countries where the customer needed help. Another factor was Zurich's ready ability to integrate the customer's captive insurer into the overall risk management program. The customer was having difficulties managing its captive insurance program, moving funds in and out of the captive as necessary, and especially in developing a full understanding of appropriate local premium allocations.

In addition to Zurich's global insurance wealth of experience, the insurer helps clients with worldwide operations manage the complex tax implications of multinational risk management. Through its Multinational Insurance Proposition (MIP), Zurich can help address varying insurance regulations, tariffs and premium tax reporting requirements. The MIP provides a process for assisting with global program compliance with such local premium tax and insurance regulatory requirements.

Zurich's MIP helped provide the above client with an improved sense of uniformity throughout the world so that, when additional countries come online with the same program, they will have a better idea about how to manage their costs and budget expenses. The MIP also assisted by reviewing local variations in policy wordings and forms and integrating them into the program. The program--which started with 16 countries--continues to grow and now serves 21 countries.

As part of its overall foreign casualty services, Zurich also works closely with companies that contract with the U.S. government to provide services on overseas U.S. military bases or federally funded public works projects. The insurer is one of a handful of companies offering Defense Base Act workers' compensation insurance, mandated by the U.S. Defense Base Act of 1941 and still in effect today. The U.S. Department of Labor administers the program.

Under the Defense Base Act, insurers cover disability and medical benefits for employees injured in the course of employment and provide death benefits to eligible survivors of employees killed in the course of employment. Contracted services include military support services, motor pool services, construction, administration, security, and many others.

Zurich recently assisted a large, U.S. logistics, IT and military support corporation with its DBA insurance needs related to the hiring of local and third-party country nationals. The location being staffed is a tropical island chain in the Pacific. The customer hires local nationals to provide support and logistical services at U.S. Air Force facilities.

Because of the remoteness of the location, the customer had concerns about the ability to provide rapid payment of costs related to employee injuries. Zurich worked with local hospitals to create a customized claims protocol that would help to streamline significantly the process of ensuring that injured employees' medical expenses would be paid rapidly and in a trouble-free manner.

Zurich's global network makes its participation in the DBA marketplace a natural, combined with a dedicated DBA claims operation staffed by personnel experienced in this specialized line of insurance.

Zurich's global network, flexibility, local knowledge and underwriting experience position the insurer to be a major player and provider in the foreign casualty marketplace.

(The above piece is part of our continuing Insights series designed to highlight key products and services to our readers. This paid-for Insights was written and edited by Risk & Insurance® on behalf of our marketing partner. Additional Insights can be found on our Web site at www.riskandinsurance.com/.)

October 13, 2008

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