Tax compliance, insurance compliance a CSL management focusPosted On: Apr. 15, 2012 12:00 AM CST
With increased global pressures on companies' local tax and insurance compliance, John J. Marren recognized the potential exposure created in its global insurance program and the need to manage it.
“We put forth a pretty significant effort about three or four years ago to make sure that we're compliant taxwise, particularly in Europe,” said the director, global risk and insurance management at CSL Behring L.L.C. in King of Prussia, Pa., and its Parkville, Australia-based parent, CSL Ltd. “Marsh has a name for it. It's called the global checkup.”
The focus was on determining the obligations and formalizing consistent processes for how the company allocates premiums, pays premium taxes and purchases local coverage in addition to its global master program. The goal is to determine how CSL makes “sure that all of those tax obligations are satisfied, who's going to make sure it happens, that sort of thing,” Mr. Marren said.
The process had its genesis when CSL couldn't document that it had paid necessary taxes. “We had had some issues where, in fact, we were audited and couldn't really provide all the documentation to support the fact that we did pay our taxes,” Mr. Marren said. “It was part of the fact that the placements had been different every year for a number of years, and keeping track of who was going to take charge of that responsibility was very difficult until we got to this program.”
Mr. Marren also credited Allianz S.E.'s global corporate and specialty group, which fronts CSL's global property program, with assisting in the compliance effort. “We've been very happy with Allianz...being the front,” Mr. Marren said. “They're extremely adept at managing and monitoring our compliance with tax obligations in every country where we operate, where we issue paper...how much the tax is, getting it paid, within the fronted program.”
CSL has to keep track of its own obligations on excess layers, “but it's only a couple of companies,” Mr. Marren said. “For the most part, we don't have exposure at that level in a lot of the countries anyway.”