How Claims Are Paid

The Ballast Mutual structure includes three layers of protection. Your Independent Account pays first, up to the amount you're comfortable with. The Group Account pays the next portion, up to a predetermined amount the group has decided upon. Backup insurance via reinsurance covers the very large claims that exceed what the Group Account pays—capping the Ballast Mutual's overall exposure for catastrophes and ensuring the long-term health of the organization.

A — Independent Account (Member’s own account)

• You contribute equity once (about 20% of your annual premium). This is your money, not a fee. The contribution can also be made via Standby Letter of Credit (available from your banker).
• The Captive Manager reassesses annually as your exposure grows (large growth in sales, substantially higher limits, and similar changes) whether additional contribution of equity is required.
• Pays the first portion of any claim
• Completely separate from every other member’s account
• Leftover money and investment earnings stay with you

B — Group Account (Shared safety net)

• Funded by Bearing Risk’s starting capital plus a portion of everyone’s premiums
• Steps in after your Independent Account has paid its share
• Builds a common reserve that strengthens the whole program

C — Reinsurance / Backup Insurance (Catastrophe protection)

• Starts only after the Group Account has paid its share
• Limits how much the program can lose on any one claim
• Keeps capital efficient for members

Claims Handling Process

Day-to-day claims adjustment is performed by a designated Claims Handler acting on behalf of the Policy Issuer. Members retain transparency into the status of their claims and maintain an advisory voice on defense strategy and settlement decisions for claims that affect their Independent Account. Large or complex claims that engage the Group Account or backup insurance via reinsurance are coordinated with Program Management to protect both individual and collective interests.