Temple University Captive Insurance Companies Article Answers
1,Captive Insurance Companies: A Common Sense Approach,
2,The Cost of Worry,
3,Entering New Markets? Consider Supply Chain Risk
Homework 4 (18 points)
- In “Captive Insurance Companies: A Common Sense Approach” by Joseph Tucciarone and Louis Biscotti, (Topic 6 Core Articles):
- In “The Cost of Worry” by Eric Copple (Topic 7 Core),
- In “Entering New Markets? Consider Supply Chain Risk”, (Topic 7 Core Articles),
- The tax deductibility of premiums paid to a captive has been an ongoing discussion with the IRS. What is the current status of deductibility of premiums paid to a captive. What does the IRS look for? (4 points)
- Why do companies form captives according to the author? (3 points)
- Give an example of how a captive can benefit a company even if it has commercial insurance coverage. (2 points)
- What does Mr. Copple think is the cost of worry? (2 points)
- How can risk managers and firms in general successfully deal with worry? (2 points)
- What are some supply chain risks with new suppliers?(3 points)
- Your company signs a contract with a new Chinese supplier. You place an order for 1000 widgets at a price of $10 each. The U.S. passes a tariff of 25% on widgets. The supplier now charges you $12,500 for the 1000 widgets. Your staff objects. If your firm practiced the steps recommended in this article, how would you handle this situation? (2 points)