Global Insurance Program

As the in-house broker of one of the most prominent trading companies in Japan, we have developed and implemented comprehensive insurance programs that cover our clients' global operations across various industries. Our unique approach leverages the servicing network of insurers rather than attempting to provide local service in-house, resulting in a cost-effective and efficient program that effectively mitigates risks and maximizes savings for our clients.

What is Global Insurance Program


A global insurance program is a method of arranging non-life insurance policies developed for global businesses and are used by many global businesses around the globe. Previously, global companies arranged individual non-life insurance policies in each country around the world where they had operations, but this earlier method presents three difficulties from the perspective of risk management.
First, by arranging individual insurance policies, it is not possible to generate the benefits of scale when negotiating insurance premiums with insurers and cost efficiency is low. Second, it is difficult to determine the details of compensation and total limits of liability are set in each region, making omissions in coverage and duplicative coverage more likely to occur. Also, even if group coverage standards are established and attempts are made to apply those standards uniformly throughout the world, this can be difficult because of coverage regulations and insurance circumstances in each country. Third, the insurers, agencies, and brokers engaged are different in each country and region, making it difficult to conduct centralized risk management and risk control on a global basis.

Structures and Functions

Global insurance programs were created to resolve these three issues and make comprehensive insurance arrangements for global risks including group companies and overseas branches located in countries around the world. Global insurance programs can be created for each type of insurance including logistics insurance, non-life insurance, and business interruption insurance, but such programs first became common in the logistics insurance field because of the unique characteristics of the risks. After shipment from a plant, the products and semi-finished goods that are the subjects of logistics insurance can travel not just to one country, but to many countries and regions around the world before delivery to the buyer. It is not reasonable to make separate insurance arrangements in each country and region for this type of fluid risk, and it is believed that since the three issues discussed above also arise and in many cases coverage regulations do not apply, global insurance programs first became common in the logistics insurance field.

Because of the need to clear coverage regulations and for local claim handling, global insurance programs are made up of a master insurance policy issued in the country that exercises central control over operations (usually, the location of the group’s parent company headquarters) and local insurance policies issued in each country where operations are conducted. The master insurance policy has coverage known as difference in condition (DIC) and difference in limit (DIL) as functions that allow for global uniform application of the coverage details and limits of liability specified in the master insurance policy.

In cases where there are differences in the details of compensation between the master policy and the local policies, the DIC covers the differences, and in cases where there are differences in the limits of liability between the master policy and the local policies, the DIL covers those differences. If local insurance policies are issued in accordance with the coverage details and limits of liability specified in the master policy, this type of coverage is not needed, but as a practical matter, restrictions arise as a result of local insurance conditions, and cases where differences arise are not uncommon.

Control Office

When creating a global program, it is in general necessary to select a central insurance company, agency, or broker from the perspective of centralized management of risks. The operation that exercises central control over the program is referred to as the control office (usually the group parent company) and performs the roles of determining the group risk management policies, central purchase of global insurance, notifying individual group companies of its decisions, and performing centralized risk management. Whether the control office can adequately take the lead concerning these roles and functions for the program as a whole and act as a unifying force is the key to successful introduction and operation of the program. Agencies and brokers provide practical support, while the insurance company underwrites insurance in each region based on the determined content, issue certificates, and performs claim handling.

Benefits of Introduction

The disadvantages that arise from making individual insurance arrangements can be eliminated by introducing a global program. In terms of cost, it is possible to perform centralized negotiations that take advantage of economies of scale and to reduce insurance premiums through innovations to cut technical costs such as having a shared limits of liability for the group as a whole. In addition, having a single contact for negotiations substantially reduces the effort and time needed for insurance arrangements by the group as a whole.
It is possible to eliminate duplicative coverage and omissions in coverage by having coverage details and limits of liability specified by uniform standards apply to all overseas operations subject to the global program. In addition, it is easy to ascertain the details of coverage, and selecting a single insurer and a single agent or broker facilitates timely sharing of information on risks and centralized management of risks.

Our Products

The classes of insurance that we handle are:

  • General liability and umbrella insurance
  • Product liability insurance
  • Property and business interruption insurance
  • Logistics insurance
  • Trade credit insurance
  • D&O casualty insurance
  • Recall expense insurance

Our Service

For a large corporate engageding in business around the globe, it would be beneficial for them to appoint a prominent international broker providing service in various countires of the globe to serve the program. However, especially with lines of insurance with low loss frequency, many of our clients prefer to eliminate appointment of local brokers to cut costs and yet to achieve the three goals described above.

We usually structure global insurane programs with prominent international insurance companies, capable of providing controlled master insurance packages, in order to provide our customers with the most cost effective global insurance program. Structuring a new program woudl typically require very long and intensive process to to reach consensus among risks managers in each region / countries. However, with regards to coroporates with strong central control, we woud be able to incept a new scheme in as quick as 3 months.

  • Month 0. Our Proposal
  • Month 1. Collection and submission of current insurance policies and underwriting information
  • Month 2. Proposal and quotation of a new scheme
  • Month 3. Inception of a new global insurance program