Captive Basics
What Are Insurance-Linked Securities?
Insurance-linked securities (ILS) are financial derivatives based on insured loss events, allowing insurers to transfer risk to capital market investors, offering diversification and potential better returns. Learn More
5 Questions to Ask When Considering a Captive Insurance Company
Under the right circumstances, a captive can provide myriad benefits and, increasingly, mid-to-large firms are looking to form or join a captive insurance company. Find out how captive insurance companies operate, the different types of captives, and five key questions to ask when considering whether to form a captive. Learn More
Letters of Credit (LOCs): The Basics
Letters of credit (LOCs) are utilized in a variety of risk management transactions and are the most frequently used type of collateral. An LOC is a legal commitment issued by a bank stating that, upon receipt of certain documents, the bank will pay against drafts meeting the terms of the LOC. Read More
Cell Captives: A Powerful Tool to Manage Risk
Cell captives are one of the many options available to companies interested in exploring captive insurance solutions. Cell captives offer organizations a way to realize all the benefits of a captive solution with significantly lower start-up and operating costs. They also take less time to implement than traditional single-parent captives. Read More
Why Do Captive Insurance Companies Get Credit Ratings?
Captive insurance companies pursue credit ratings to strengthen corporate governance, improve transparency, and reduce costs. A strong rating reassures reinsurers and fronting companies, potentially lowering fees and premiums. Additionally, captives use the rating process to benchmark performance and gain insights into financial health and best practices. Read More
What To Expect from an Actuarial Analysis
An actuarial analysis estimates a company's unpaid insurance losses, offering insight into funds needed for claims. This analysis is crucial for companies retaining significant insurance risks and can help determine the benefits of forming a captive insurance company to manage these risks more effectively. Read More
Insuring Unique Risks in a Captive
Captive insurance companies can be used to insure just about any risk to which a parent company is exposed. Read More