Loss Sensitive Pay Plans
Sentry understands the need for alternatives for insurance-related collateral requirements. We are dedicated to working with you to find optimal solutions to meet your business's collateral requirements, with options including:
- Prefunded Loss Plans - Estimated ultimate losses and loss adjustment expenses are held in a loss fund. All premium and loss fund obligations are payable in 12 installments, with annual adjustments to estimated ultimate losses thereafter. There is no collateral with these plans.
- Monthly Incurred Plans - These plans bill monthly paid and case reserve activity offering many of the same cash flow advantages as a paid loss plan. An additional benefit is a reduced or waived collateral requirement depending on the financial strength of the insured. No loss fund is required with these plans.
- Cash as Collateral - Cash can be posted as collateral and Sentry will pay interest on this amount. There is no surcharge for posting cash as opposed to other methods.
- Trusts as Collateral - These are accepted for accounts with above-average financial strength. Trusts typically offer a more cost-effective approach to posting collateral than a Letter of Credit. They also earn interest on the assets posted.
- Letters of Credit - This common approach to fulfilling collateral requirements is accepted by Sentry.
