Risk and insurance · Premium Allocation (rm.Allocations)
Insurance premium allocation
Allocate insurance premiums and fees across business units and locations, and bill them back.
The problem
Premiums and fees for several programs are split across business units in spreadsheets whose formulas change each year and live with one analyst. Business units challenge charges they can’t trace, finance waits on the numbers for budgets, and testing another allocation means rebuilding the spreadsheet.
- Premiums32%Not reduced. Allocation shows each business unit its share, which gives them a reason to lower it.
- Retained losses62%Not directly affected.
- Cost to manage risk6%Automation takes out the manual steps: fewer spreadsheet errors, less back and forth with business units, and allocations out sooner. In this example, premium allocation and billing take about 720 staff hours a year, roughly $52,000.
Typical split from the Risk Diagnostic’s example: a public agency with a $1.2 billion budget. Take the diagnostic and this chart shows your own numbers.
What it does
Allocation rules
Allocate by exposure, revenue, headcount or your own formula, across programs, product lines and business units.
Clear statements
Each business unit sees how its charge was calculated.
History
Year-over-year allocations kept for reference.
Bill back
Charges by business unit and cost center, exported as a file for your finance team to post.
Scenario testing
Test allocations before release, then revise and retest.
82 currencies
Premiums and fees in any of 82 currencies, converted with managed exchange rates.
Full record and reporting
Every action and message between your team and outside parties is logged, and ad-hoc reports give real-time allocation, process and performance data.
How it works
- 1Premiums and fees entered
- 2Allocation rules applied
- 3Statements reviewed
- 4Charges posted
What to expect
Who uses it
Risk management and finance teams that charge insurance costs back to business units.
Questions
Can we use our own allocation formula?
Yes. Allocate by exposure, revenue, headcount or a formula you define.
How do charges reach our general ledger?
RiskWorks exports the charges by business unit and cost center as a file, which your insurance buyers or finance team post downstream.
Related
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Learn moreWhat does risk cost your organization?
The free Risk Diagnostic gives you an approximate total cost of risk and shows where your organization’s time goes, compared with your industry. Then review it with an Exigis analyst at no cost.