Captives and Alternative Risk Financing
See also:Case Study

A soundly constructed and professionally managed captive insurance company that is supported by world-class reinsurance partners is a vital tool available to the modern Risk Manager. Some of the important benefits of a captive insurance company are:
  • The ability to stabilize premiums and loss costs over a long-term;
  • The opportunity to capture interest income, ceding commissions and profit commissions that are normally available to primary insurers;
  • The ability to build a surplus from good loss experience that allows the captive to safely retain risk and support the parent company’s risk tolerance strategy;
  • Lower insurance transactional costs;
  • Direct access to world-class re-insurers with significant capacity and the ability to cover difficult risks on a long-term basis;
  • Broad insurance coverage and a platform for developing alternative risk financing programs;
  • The flexibility to deliver risk management programs and value added risk management services that are focused to the unique risks of the corporation;
  • Independence from the traditional insurance market that has inherent conflicts of interest;
  • The ability to accelerate the recognition of tax deductions and remove balance sheet liabilities of the parent company;
A captive is not a suitable risk management tool for every business. RM Solutions offers a Captive Pre-Feasibility Review that will “model” a 5-year pro-forma Income Statement. Using historical loss and premium data from your business and making some general assumptions, we are able to provide observations and recommendations you should consider if you wish to go to the next step of a full captive feasibility study.

There is no charge for this review and no obligation. Please contact us if you have an interest in obtaining a Captive Pre-Feasibility Review.