APC 2012 Annual Report Download - page 42

2012 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC40
OVERVIEW OF THEGROUP’S STRATEGY, MARKETS AND BUSINESSES
1RISK FACTORS
Self insurance
To optimize costs, Schneider Electric self-insures certain frequent,
low-amplitude risks through two insurance captive companies:
•outside North America, a reinsurance captive company based in
Luxembourg offers damage and civil liability coverage capped at
EUR19million per year;
•in North America, a insurance captive company based in
the US (Vermont) is used to standardize deductibles for civil
liability, workers compensation and automobile liability policies.
These retentions range from USD1million to USD5million per
claim, depending on the risk. The maximum annual retention
is USD15 million for civil liability risk. An actuary validates the
provisions recorded by the captive company each year.
The cost of self-insured claims is not material at the Group level.
Cost of insurance programs
The cost (including tax) of the Group’s main insurance plans,
excluding premium paid to captives, totaled around EUR22million
in2012.