Captive Innovation and the Role of Technology in Captive Formations


Captive Use Trends & Innovations | Rob Walling | Principal, Consulting Actuary | Pinnacle Actuarial Resources, Inc.


According to Rob Walling, principal and consulting actuary with Pinnacle Actuarial Resources, Inc., technology is playing an exciting role in captive innovation and formation. Captive formation is stemming from InsurTech activity, such as on-demand insurance running through smartphone technology, as well as from a variety of disruptive technologies. Some examples are medical technology product warranty captives, renewable energy captives, and innovative captive structures and approaches in the cannabis space.

There is a lot of technology that is coming into the captive insurance industry that is challenging the captive industry's ability to innovate and be creative, which is what captives do well. The captive industry is serving disruptive technology needs in a way that the admitted insurance industry cannot. The traditional commercial insurance industry struggles in situations where historical data is unavailable. The captive industry's ability to innovate and look to data from other sources fosters agile new coverage development.