HOW DOES A JLT DISCRETIONARY TRUST WORK?
A JLT Discretionary Trust (JDT) is always structured to match the needs of its members and their clients. Fundamentally, it is designed to build an initial layer of funds to pay for the majority of everyday losses. Insurance is then purchased to protect members for losses above this layer. The members of the JDT make contributions to a fund, which is then held in a designated bank account for the benefit of members and managed by a Trustee.
The funds are then utilised to:
- Meet claims
- Purchase insurance protection above the initial layer
- Cover the costs of establishing, managing and administering the JDT facility
- Return potential surplus benefits
Any surplus profits can be distributed to members each year in the form of Discounts on future costs, or alternatively they can be used to fund other activities such as risk management and promotional seminars to educate members of the JDT and help reduce costs and claims.
WHAT TYPE OF RISKS CAN A JDT PROTECT AGAINST?
In addition to the more familiar covers usually seen in conventional insurance programs, the JDT can be designed to potentially address any types of exposure, often beyond the scope of what is normally available from the traditional insurance market.