Content area
Full text
In its latest innovation in funding benefits through a captive, The Coca-Cola Co. is using its Dublin-based captive insurer to fund benefits earned by pension plan participants in the United Kingdom and Ireland.
Under the arrangement, which Coca-Cola risk management and human resource executives unveiled last week at the Business Insurance Risk Management Summit in New York, Coca-Cola is using Dublin captive Coca-Cola Reinsurance Services Ltd. to reinsure group annuity products written by a top-rated European-based insurer--and purchased by three of its pension plans in the United Kingdom and Ireland.
Coca-Cola executives say the program, which has been in the planning stage for nearly two years, will generate significant operational efficiencies and potential financial advantages.
Instead of dealing with a diverse group of pension plan trustees and investment managers for each plan in different countries, Coca-Cola will be able to consolidate asset management through the captive.
In addition, if investment results are strong, the surplus generated would accrue to the captive and could be used by Coca-Cola rather than having to remain in the plan.
"This is a fantastic opportunity to bring value...