MAXIS Global Pool Solution
Managing multiple insurance contracts in different countries, each with its own specific market practices, renewal processes and regulations can be a challenge for multinational employers. How can you effectively manage your programme and offer the benefits your people need without breaking the bank?
Pooling is still one of the most popular ways for multinational employers to manage their global employee benefits (EB) risks, combining local insurance policies into an international pool through reinsurance. This uses global purchasing power to deliver stronger risk management and better global governance.
A pool is a profit-sharing arrangement, which means that employers have the potential to receive a dividend, if there’s a positive result at the end of the year.1
1A ‘dividend’ in the context of multinational pooling is the profit-sharing payment made when the reinsurer shares
an applicable part of the underwriting profit with the multinational company
How it all works (the technical bit!)
Employee benefits policies are combined to form a global pool through reinsurance.
Annual dividends can be shared with the global employer, depending on the financial results and the dividend calculation method of the pool programme. Each year a report is shared detailing the participating local policies, the performance of the programme and the calculation of any available dividend.
In some circumstances, you can actively manage your pool, where we use your dividends to try and achieve a break-even pricing strategy.
Eligible coverages include any group policies, such as:
- life benefits
- accident benefits
- disability benefits
- medical and dental coverage
Supporting you through every step of your pooling journey
The MAXIS Global Pool Solution is designed to support you at every stage of your pooling journey. Most pool programmes will begin as part of a multi-employer pool (MEP). The MEP has been designed for multinationals with less than US $750k in participating premium in the pool.
It uses an annual stop loss (ASL) accounting method, meaning losses aren’t carried forward and every pool year begins with a clean start. If the performance of the programme is positive, the dividend is then calculated on a collective basis with other MEPs. This approach helps reduce the volatility and make the experience more predictable for smaller pools.
Once a programme reaches US $750k in premium and meets the qualifying conditions, it will transition to a single-employer pool (SEP). The SEP gives greater flexibility, with a choice of accounting methods and preferred currency. And if the performance of the programme is positive, the dividend is calculated on a standalone basis.
MAXIS Global Pool Solution allows for a seamless transition between MEP and SEP as the programme grows, without the need for a new contract.
Multi-employer pool (MEP) vs single-employer pool (SEP)
MEP | SEP | |
|---|---|---|
Dividend calculation method | Calculated on a collective basis | Calculated on a standalone basis |
Accounting method | Annual stop loss (ASL) - any negative pool result is written off at the end of each year | Indefinite loss carried forward (ILCF), loss carried forward 5 years (LCF5Y), or loss carried forward 3 years (LCF3Y) |
Number of countries required | 2 | 2 |
Premium volume required | US $250,000 | US $750,000 |
Preferred currency | USD | USD, EUR, GBP or CHF |
Why choose MAXIS Global Pool Solution?
We have a long history of working with multinationals using a pool to manage their global EB. We can set up a new pool and help you move new policies into the programme. We offer:
2 Where the local policy experience is credible enough
Frequently asked questions...
Who is this solution for?
Multinational employers who are managing their employee benefits centrally.
How much EB premium do we need to have in our local policies to make a pool work for us?
To start your MAXIS pooling journey, you’ll need to operate in at least two different countries and have at least US $10,000 in premium in each country, with a total of US $250,000 across all markets.
What happens when we reach the US $750k premium mark and are ready to move to a SEP?
Once you reach US $750k in total premium and meet the qualifying conditions, you will be seamlessly transferred from MEP to SEP. There will be no need for a new or amended contract.
What if we’re not centralised enough to start a pool at this time?
No problem! We can look to start you off with a MAXIS Global Preferred Data Solution, which we can strategically grow towards becoming a pool. Many of our existing clients have followed this path.
What if we don’t have an existing global employee benefits programme in place?
If you are at the start of your global employee benefits journey, we would recommend the MAXIS Global Pool Solution or MAXIS Global Preferred Data Solution.
How can I find out more?
Download the slipsheet here, or get in contact with us here.
Not the solution for you? Find out more about our other EB solutions...
MAXIS Global Captive Solution
Our MAXIS Global Captive Solution provides highly efficient risk management for multinationals looking to set up an employee benefits captive programme.
MAXIS Global Preferred Data Solution
Our MAXIS Global Preferred Data Solution delivers consolidated financial data to multinational employers, providing better global oversight and risk management.
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