Beyond insurance premiums: how to optimise Total Cost of Risk (TCOR) to generate business value

In an increasingly volatile environment; where risks are becoming ever more complex — cyber attacks; supply chain disruptions; extreme weather events — companies can no longer afford to view insurance as a simple cost center. It is time to embrace a strategic approach to risk: Total Cost of Risk (TCOR).

What is TCOR and why does it really matter?

TCOR represents the total cost a company incurs to manage its risks. This includes not only insurance premiums; but also:

• Uninsured losses (excesses; self-insured events)
• Risk prevention and management costs
• Internal administrative costs (policy management; claims; brokers)

According to ERA Group's experience; focusing solely on insurance premiums means ignoring up to 70% of the real cost of risk.

Why a TCOR approach is a competitive advantage

Implementing a TCOR strategy allows decision makers to transform risk from an unpredictable cost into a lever for efficiency; business continuity and EBITDA improvement. The concrete benefits?

• Cost reduction of up to 15% within 2–3 years
• Streamlining of internal activities (up to 40% reduction in administrative costs)
• Faster claims management (up to 50% time saved)
• Data-driven decisions thanks to RMIS (Risk Management Information System) tools

Digital tools and intelligent solutions: RMIS & ART

ERA Group supports companies in implementing RMIS to:

• Monitor policies; claims and KPIs in real time
• Automate renewals and simplify document management
• Activate dashboards for an integrated view of risk

At the same time; Alternative Risk Transfer (ART) solutions allow companies to rethink the way risk is insured and retained; creating more efficient and sustainable strategies.

Real case studies: concrete results

• Large-scale retail group with over 500 stores in Italy: complete reorganisation of the insurance program; creation of an internal brokerage company → –47% annual costs; €486;000 in savings
• UK real estate company: increase in excess and dedicated claims fund → 15% immediate savings on premiums; without reducing coverage
• French video surveillance company: total cancellation of the policy for transported goods → 97% annual savings
• US contractor: creation of a captive → £390;000 annual savings; long-term insurance stability

How to tell if it's time to review your insurance strategy

If your company answered 'yes' to two or more of these questions; it's time to explore a TCOR optimisation path:

• Have premiums increased in the last 24 months?
• Have deductibles been strategically reviewed?
• Are uninsured losses impacting EBITDA?
• Do you know how much your TCOR affects your turnover as a percentage?

Why choose ERA Group

ERA Group is not a broker; but a strategic and independent partner with decades of experience in cost and risk management in sectors such as real estate; retail; manufacturing and services. Our approach combines:

• In-depth analysis and TCOR diagnosis
• Modelling of risk retention scenarios
• Implementation of RMIS platforms
• Insurance governance and program renegotiation support

In a world where risk cannot be eliminated but only managed; competitive advantage belongs to those who have full visibility.

With ERA Group; you can transform risk from a hidden cost into a strategic lever.