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Regulators Expect COVID-19 To Prompt Pandemic Coverages in Captives

Captive insurance companies may serve as valuable tools for many organizations addressing pandemic-related risks in the wake of COVID-19, but regulators will closely scrutinize captives' pandemic coverage plans. Policy language, triggering events, coverage details, and reinsurance will be key considerations.
July 01, 2020 Read More
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Will Captives Benefit from the Hardening Market?

Conventional wisdom holds that hardening insurance and reinsurance markets benefit captive insurers, but that might not be the case this time. Here are three potential issues that could have a negative impact on captives as they look to benefit from rising commercial insurance prices.
June 29, 2020 Read More
Billy Onion, Associate Actuary, Milliman

Pro Forma Financials' Place in the Captive Formation Process

Pro forma financials are a significant part of the captive formation process and provide an assessment of the expected financial results for the proposed captive insurance company, according to Billy Onion, associate actuary, Milliman.
June 24, 2020 Read More
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Hardening Traditional Market Drives Pace of New Captive Formations

With insurance premiums rising sharply for a wide range of coverages in the traditional market, captive insurance managers and regulators see captive formations increasing dramatically over the remainder of the year, with those increases continuing in 2021.
June 22, 2020 Read More
Two Dollar Signs with Guitar Necks on Black and White Background

"The Song Remains the Same" (The Peril of Ignoring Investment Risk)

Individuals and companies are often too quick to forget about investment risk, or assume the risk probability of the event is too small to happen. Real-life examples also illustrate that there will always be investors reaching for yield, especially in low-interest-rate environments, and when they should beware.
June 17, 2020 Read More
Steven Bauman, head of global programs and captive practice in North America, AXA XL

Captives Can Be an Important Tool for Managing Key Emerging Risks

Captives can play an important role in addressing emerging risks such as cyber risks or with volatility such as that seen with property risks, according to Steven Bauman, head of AXA XL's global programs and captive practice in North America.
June 15, 2020 Read More
Dark-Haired Businessman Wearing Suit Ponders Question Marks

Ask the Right Questions To Determine Whether a Captive Is the Answer

As insurance markets continue to harden, many businesses are considering captive insurance companies as an option to address some of their risks. Before taking the step, however, it's important to consider whether a captive is the right fit and, if so, what sort of captive structure is most appropriate.
June 10, 2020 Read More
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Captive Regulation Largely Business as Usual during Pandemic

Experiences shared by a panel of captive insurance regulators suggest that while some things might have been done differently, captive regulation largely continued in a business-as-usual fashion during the COVID-19 pandemic. The regulators spoke in a webinar sponsored by the International Center for Captive Insurance Education.
June 08, 2020 Read More
Human Head Wearing Glasses with Numbers in Lenses and Surrounded by Numbers

How Numerate Is Your Board? The Case for Captive Board Numeracy

What is "numeracy," and why is it an important attribute for captive board members to have? This article examines numeracy, innumeracy, and relevant examples—with a specific look at insurance.
June 03, 2020 Read More

Recent News

2020 Bermuda Captive Conference To Be Virtual Event Due to COVID-19

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The 2020 Bermuda Captive Conference will be held as a virtual event due to continued uncertainty surrounding the COVID-19 pandemic. The online event, which had earlier been rescheduled from June to September as an in-person event, will take place September 9–11.
July 01, 2020 Read More

New FERMA Survey Shows Hard Market Increasing Interest in Captives

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A survey of European risk managers shows a growing number of companies looking to captive insurance as an alternative to a hardening insurance market. The European Risk Manager Report 2020, conducted by the Federation of European Risk Management Associations (FERMA), found 43 percent of respondents indicating they are considering using captives.
June 30, 2020 Read More

COVID-19 Pandemic Could Contribute to Record Catastrophe Losses

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Guy Carpenter said the COVID-19 pandemic looks to rank among the insurance and reinsurance sector's most expensive events, contributing to total 2020 catastrophe losses ranging from $100 billion up to $160 billion. The pandemic also could be one of the slowest developing catastrophes insurers and reinsurers have experienced.
June 30, 2020 Read More

Rising Reinsurance Prices, Tighter Conditions Attracting New Capital

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Reinsurance price hikes are drawing additional capital to the market amid the fallout from the COVID-19 pandemic, according to Fitch Ratings. In the current environment, there is potential for double-digit reinsurance price increases to extend into 2021, Fitch said.
June 29, 2020 Read More

Guernsey Insurance Group Signs on to UN Green Initiative

The Guernsey International Insurance Association (GIIA) has signed on to a United Nations (UN) green program as part of its commitment to developing green and sustainable finance. The GIIA is now a supporting institution of the United Nations' Principles for Sustainable Insurance Initiative.
June 26, 2020 Read More

July "CICR" Explores Captive Insurance Digital Transformation

Captive Globe-SF 
Don't miss the July issue of "Captive Insurance Company Reports" ("CICR"), which explores the benefits of digital transformation to the captive insurance industry and the timeliness of the need to bring stakeholders together and implement technology-enabled solutions.
June 26, 2020 Read More

Tennessee Names Belinda Fortman Captive Insurance Section Director

Belinda Fortman--Tennessee Department of Commerce & Insurance Captive Insurance Section Director 
The Tennessee Department of Commerce & Insurance (TDCI) has announced that Belinda Fortman will join TDCI as Captive Insurance Section director. Ms. Fortman, who moved to Tennessee from Vermont in 2013 to support the growth of captive insurance in Tennessee, has decades of experience in the captive insurance industry.
June 25, 2020 Read More

Kentucky Captive Association Moving Annual Conference Online

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Due to concerns about the COVID-19 pandemic, the Kentucky Captive Association has converted its annual conference to a virtual event. The conference, which had been originally scheduled for September at the Northern Kentucky Convention Center in Covington, will now be held online August 20.
June 25, 2020 Read More

COVID-19 Pandemic Has an Impact on June 1 Reinsurance Renewals

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June 1, 2020, renewals provided the first test of the COVID-19 pandemic's impact on reinsurance markets, resulting in property-catastrophe pricing increases.
June 24, 2020 Read More

NAIC Report Details State Insurance Regulatory Response to COVID-19

Businessman Using Tablet To Analyze COVID-19 Economic Fallout Data 
The National Association of Insurance Commissioners (NAIC) has released its first update on the state insurance regulatory response to COVID-19, noting the pandemic's impact on the NAIC's 2020 regulatory and operational priorities. The report says that state insurance regulators and the NAIC have been closely monitoring insurers' financial health.
June 23, 2020 Read More

Catastrophe Bond Issuance Continuing at a Brisk Pace in June

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Catastrophe bond and insurance-linked securities issuance continued at a brisk pace over the past month, according to Artemis, with 2020 issuance approaching $8.25 billion. The Artemis Catastrophe Bond & Insurance-Linked Securities Deal Directory showed the issuance of just over $1 billion in new cat bonds over the past month.
June 23, 2020 Read More

Insurer Ratings Review Shows Industry's Resilience Entering Pandemic

ResiWord Resilience on a Road Sign with Brown Grass and Mountains in Background 
Fitch Ratings says a review of the COVID-19 pandemic's impact on global insurance sector ratings found that the rate of negative outcomes highlights the industry's resilience going into the pandemic. The rating agency defined "negative outcomes" as the combination of negative outlooks, negative watches, and downgrades.
June 22, 2020 Read More

SIIA Seeks Treasury Department Review of IRS 831(b) Captive Activities

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In a letter to US Treasury Secretary Steven Mnuchin and Russel Vought, acting director of the Office of Management and Budget, the Self-Insurance Institute of America (SIIA) has asked the Treasury Department to review activities of the Internal Revenue Service (IRS) related to 831(b) captive insurance companies.
June 19, 2020 Read More