The News You Need for Sept. 15
What might the future hold when it comes to captive insurance and what was the "big fight" all about?
Captives 101: Future Trends in Captive Insurance?
In a previous article, we discussed the critical role captive managers and service providers play in ensuring the success of a captive insurance program. As captive insurance continues to evolve, companies must stay informed about emerging trends that may impact their captives. The insurance landscape constantly evolves due to technological advancements, regulatory changes, and global events. This article will explore future trends shaping the captive insurance industry and how businesses can prepare for these changes.??
The Impact of Technology on Captive Insurance??
One of the most important trends impacting captive insurance is technology integration. InsurTech solutions such as artificial intelligence (AI), blockchain, and big data analytics are changing how captives work. These technologies improve risk management, streamline claims processes, and provide better insights into financial performance. For example, AI can analyze large amounts of data to identify claims trends and predict potential risks, helping captives set premiums more accurately. Blockchain technology is also making its mark in the world of insurance. It offers greater transparency, security, and efficiency in policy administration and claims processing. Captives that leverage blockchain can reduce the time and costs associated with claims management, making their operations more efficient. Using big data analytics gives captives deeper insights into their risk profile, enabling them to make data-driven decisions that improve overall risk management strategies.??
The Emergence of Cyber Risk Captives??
As cyber threats grow, businesses increasingly turn to captives to manage cyber risks. Cyber insurance is one of the fastest-growing sectors in the insurance industry, and captives play a vital role in covering cybersecurity risks. Cyber risk captives allow businesses to design tailored coverage that meets their specific needs, providing protection that traditional insurance policies cannot. Cyber risk captives also enable firms to implement proactive risk management strategies, such as cybersecurity training and technology upgrades, to reduce the likelihood of a cyberattack. As cyber threats evolve, captives will be increasingly crucial in helping businesses manage these risks.??
Regulatory changes and their impact on captives??
Regulatory changes continue to shape the captive insurance landscape. As more jurisdictions introduce new regulations to address emerging risks, businesses must stay informed and adapt their captives accordingly. In particular, rules relating to data privacy, climate risk, and environmental, social, and governance (ESG) factors are becoming increasingly important. Many regulators now focus on ESG criteria as part of their oversight of captives. Companies that fail to integrate ESG considerations into their captives may face increased scrutiny from regulators. Data privacy regulations, such as the General Data Protection Regulation (GDPR), also affect how captives manage sensitive information. Companies must ensure their captives are compliant with these regulations to avoid penalties.??
The Growth of Captives in Emerging Markets??
While captives have traditionally focused on markets such as the United States, Bermuda, and Europe, interest in captives is growing in emerging markets. Countries in Asia, Latin America, and Africa are exploring captive insurance to manage risk more effectively. As these markets develop their regulatory frameworks for captives, companies may find new opportunities to expand their captive insurance programs in these regions. Several factors, including increased demand for risk management solutions, economic development, and business globalization, drive the growth of captives in emerging markets. As companies expand into new regions, they may find that captives provide a flexible and cost-effective way to manage risk in areas where traditional insurance may be limited or expensive.??
Focus on ESG and Sustainability in Captive Programs??
Environmental, social, and governance (ESG) factors are becoming increasingly important to companies and their captives. Investors, regulators, and customers are placing greater importance on sustainability and ethical practices, and captives are no exception. Captive insurance programs now integrate ESG considerations into their risk management strategies, underwriting guidelines, and investment decisions. Captives can be key in supporting a company's broader ESG goals. For example, a captive may cover environmental risks such as pollution or climate-related damages. It may also invest in sustainable projects or support social initiatives consistent with the parent company's values. As ESG emphasis continues to grow, captives that integrate these factors into their programs will be better positioned to meet the rising expectations of stakeholders.??
The Impact of Global Events on Captives??
Global events such as pandemics, natural disasters, and economic changes significantly impact the captive insurance industry. For example, the COVID-19 pandemic has increased interest in captives as companies seek more control over their risk management strategies. Captives have proven to be a flexible solution for managing pandemic-related risks such as business interruptions and supply chain disruptions. As the world faces more frequent and severe natural disasters such as hurricanes, wildfires, and floods, captives will play a critical role in helping businesses manage these risks. The ability to tailor coverage to meet specific risks makes captives an attractive option for businesses operating in disaster-prone areas. Economic changes, such as inflation or interest rates, also impact the financial performance of captives. Companies must stay attuned to global economic trends and adjust their captive strategies accordingly to ensure long-term success.??
Several emerging trends are shaping the future of captive insurance, from technological advancements to an increased focus on ESG factors and cyber risks. As businesses navigate this evolving landscape, captives will continue to provide a flexible and effective solution for risk management. By staying aware of these trends and adapting their captives to meet new challenges, companies can ensure that their captive insurance programs remain a vital part of their risk management strategy.??
The following article will examine real-world case studies of successful captive insurance programs. These examples will provide practical insight into how companies leverage captives to achieve risk management goals.?
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Lawsuit Alleges Sheriff’s Recruit Died in Forced 'Fighting Circle'
Evansville, Ind. (WorkersCompensation.com ) – A lawsuit filed in Indiana this week alleges that a sheriff’s deputy died after being forced to fight as part of his training.?
Kourtney Hacker, the wife of Asson Hacker, filed the suit in Vanderburgh County Superior Court against the Southwest Indiana Law Enforcement Academy (SWILEA) alleging that her 33-year-old husband was forced to fight a veteran officer during a training course, and then died. Court records indicate that she is represented by Indianapolis-based attorneys Charles Hayes and Steven Lammers.?
The lawsuit, filed Sept. 3 against SWILEA, as well as the Knox County Sheriff’s Office, the Evansville Police Department and several individuals, alleges that Asson Hacker died due to the defendants being “negligent in their failure to provide immediate and proper medical care to Hacker.”?
According to the filing, Hacker was recruited to join the Vanderburgh County Sheriff’s Office. As part of the job requirements, Hacker was to go through a training program by SWILA. On March 2, 2023, SWILEA held a training event called the “Big Fight” in Evansville. In order to become a full-time law enforcement officer, the lawsuit said, male recruits were required to participate in the fight.?
“The Big Fight was set up in a fighting circle similar to that of an MMA or UFC style fight,” the lawsuit said.?
Kourtney Hacker alleges in the filing that her husband was ordered to fight Major Michael Fisher with the Knox County Sheriff’s Office, who was also an instructor with SWILEA. Fisher “had significantly more training in fighting than Hacker,” the lawsuit said. During the fight, which was filmed, Fisher allegedly choked, hit, punched, kicked and body slammed Hacker, as well as “impeded Hacker’s ability to breathe” at times.?
Court documents said Fisher employed tactics that would be considered excessive force. The lawsuit also alleges that the fight was akin to hazing.?
“The ‘Big Fight’ was treated as a rite of passage for recruits, and was a hazing-styled exercise, as opposed to a legitimate training exercise,” the lawsuit said.?
While the fight was only supposed to last no more than five minutes, officials overseeing the fight did not end it at five minutes, and instead encouraged the two sides to continue. After the fight, Hacker was on the ground, motionless. Instead of taking him immediately to the hospital, the lawsuit said, several other fights were conducted. According to court records he was taken to the hospital at 12:06 p.m., and declared dead at 4:03 p.m.?
Photographs posted to the Evansville Police Department’s Facebook page on March 22 show SWILEA training at the same location that the “Big Fight” took place at – fights which reportedly preceded Hacker’s death. The images showed what appeared to be recruits and instructors in sparring gear. While it wasn’t clear form the photos if the March 22, 2022 training constituted an earlier “Big Fight,” the department’s accompanying Facebook post seems to corroborate claims made in the suit – namely that cadets would be paired with a defensive tactics instructor at the conclusion of the course to “use the tactics they’ve learned in a scenario.”?
According to the Vanderburgh County Coroner’s Office, Hacker died as a result of exertional sickling and sickle cell trait. Exertional sickling, the University of Connecticut’s Korey Stringer Institute said, is a “medical emergency occurring in athletes carrying the sickle cell trait.” When it occurs, red blood cells change shape or “sickle” which causes a build-up of cells in small blood vessels, leading to decreased blood flow. The drop in blood flow leads to the breakdown of muscle tissue and cell death.?
The Evansville Police Department said Hacker died after he participated in “routine physical tactics” during training at the academy. According to the Evansville Courier & Post, the coroner’s determination of a “natural” death as the result of exertional sickling and sickle cell trait spurred the Vanderburgh County Sheriff’s Office to institute new screening protocols for cadets who could be at risk of developing the condition.?
For its part, the Vanderburgh County Sheriff’s Office released a statement on Monday that it continues to mourn Hacker’s “tragic and untimely passing.”?
"While the sheriff's office is not a named party in the lawsuit filed by Deputy Hacker's estate, we are closely monitoring the developments in this case," the statement reads, in part. "We believe many of the allegations contained within the complaint are either inaccurate or misleading."?
Hacker’s estate said his death was linked to his participation in SWILEA’s training program which was sponsored by the city. The lawsuit claims the city “placed Hacker in a position of danger that he otherwise would not have faced,” and that Hacker “did not knowingly consent” to be in.?
"The 'Big Fight' was not a legitimate training exercise but rather a state-sponsored hazing event that created an obviously dangerous situation," the complaint states.?
Kourtney Hacker is seeking compensatory and punitive damages, in addition to reasonable court costs.
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