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WorkComp Funding

 Employer Organizations Are Looking For a New Solutions to Remain Competitive

Key Questions:

  1. Would your organization like to level or custom design your Workers Compensation payments for the next 60 months?

  2. Would your organization like to be rid of the required LOCs?

  3. Would your organization like to take this liability off your balance sheet?

 

Our Solution Set: The CareBond Model

  • We have built a suite of tools that will address many of the issues workers’ compensation plans face today

  • A Workers’ Compensation financing structure that quantifies workers’ compensation and other related costs

  • Using a sophisticated actuarial model to clearly define and manage cash outflow given a chosen confidence level

 

Our Two- Tiered Solution:

  1. Analyzes the existing arrangement employers have with their providers

  2. Develops a financial remedy to contain, budget, and fund costs without modifying existing conditions

 

The Value Proposition

The CareBond Model brings the following value to any plan by:

  • Establishing an identified and budgeted flat line workers’ compensation cost over 60 months

  • Mitigating the need to post LOCs based on the overall collateral established by the fund to cover future exposures over 60 months

  • Creating a medium term horizon which allows flexibility to adjust and revise trend data in future funding cycles

  • Shifting from a reactive to proactive financial risk management strategy which insulates an organization’s general fund

  • Contains volatility to facilitate a cost effective long-term funding and budgeting platform

Engagement Timeline

Day 01

Client signs NDA (Non-Disclosure Agreement)

Client Supplies all relevant data, i.e. census, claims, Rx data, etc. For the past three years

Working With You and Your Consultant

We securitize your workers’ compensation liability over five (5) years through:

  • Utilizing a SPE that is separate from the business and for the benefit of plan participants

  • Accelerating the tax benefit locked in your reserves

  • Establishing a level 5-year or custom designed cash flow expense

  • A structure that makes earnings more predictable – remittance to the SPE is your expense

Information Needed for a Phase 1 Assessment

  • An actuarial report that identifies your “paid” and “reported losses” and allocated loss adjustment expense development by fiscal year for the last 3 years

Structure Elements and Providers

The Trust

  • Organized under IRC§501 (c) (9)

  • Trustee – Alta Trust Company, Lone Tree, CO

  • Asset Manager – Principal Financial Group, Des Moines, IA

The Debt

  • Private Placement Agent – The Frazer Lanier Company, Montgomery, AL

Structuring Team

  • Structure Developer and Implementation – CareBond Advanced Funding, Oak Brook, IL

  • Legal Counsel – Schulte, Roth & Zabel, New York, NY

Introductory Consultation

Contact:

Kevin@CareBondDirect.com 

Consultation with Advanced Funding principals:

Jeffrey Bemoras 

Principal

Chris Stepuszek

Principal

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