Captive Insurance Educator Ties Evolving Curriculum to Industry Growth

Few people have had a front-row seat to the explosive growth of captive insurance like Mitch Cantor. After running a large community theater company in Vermont, the second US state after Colorado to enact a comprehensive law authorizing and regulating captive insurance companies in 1981, he went on to become executive director of the International Center for Captive Insurance Education (ICCIE).  

ICCIE, which is pronounced "I see," was conceived 3 years earlier by the Vermont Captive Insurance Association. It emerged as a 501(c)(3) organization out of concern that a critical lack of education and training would undermine the industry's growth and professionalism. A comprehensive curriculum was then developed for captive insurance industry practitioners in collaboration with the University of Vermont, though it had limited additional involvement. 

"What's important is that we need to get everyone at least the same base levels of understanding if they're going to be effective practitioners in the industry," he explains, noting that ICCIE stays in close contact with all of its graduates.  

In Pursuit of Clarity 

Cantor sees a wide range of students enrolling in ICCIE courses. Not surprisingly, they include those who are fresh out of college or brand-new to insurance or captives and need to learn this industry from the ground up. But there are also those who've been on the traditional side of insurance for 10, 15, or 20 years without any substantial knowledge about the captive industry.  

Whatever their path, he says the greatest value of this education is that they're able to see more clearly how their area of expertise fits into the entire industry.  

"If someone on the actuarial side, for instance, sees how all the rest of the other aspects of the industry work, how the investment advisers work, and how captive owners and captive managers look at things, they'll just have a much better perspective when they're dealing with their clients."  

Noting that ICCIE's goal from the very beginning was to offer an associate captive insurance (ACI) designation, Cantor says the organization has evolved like everything else in the industry and also offers a certificate in captive insurance (CCI).  

"Our original designation was comprised of five core courses that we offered and two electives from outside organizations The Institutes or IDE," he explains. "We've now shifted that and actually increased our core courses to seven. We still require two electives, but we now offer 10 electives of our own and still also allow outside electives."  

Core courses include "Understanding Risk and Risk Retention Mechanisms," "Investment Basics for Captives," "Forming and Operating a Captive," "Reinsurance and Other Risk Transfer Mechanisms," "Business Ethics in the Captive Insurance Industry," "Predicting Risk and an Introduction to Actuarial Science," and "An Introduction to Alternative Risk Financing Mechanisms." 

Broadening the scope of electives allows students to cover topics that interest them most in depth in a way that is not possible in core courses, Cantor notes. This course work now includes "Captive Board Governance," "Taxation of Captive Insurance Arrangements," "Understanding the Intricacies of Cell Captives," "Accounting for Captives: Financial Reporting and Analysis," Healthcare Captives Overview," "Employee Benefits and Captives," "Risk Retention Groups," "Captive Claims Management Best Practices and Reinsurance," "Accounting for Captives: Interpretation and Management Perspectives," and "Regulation of Captives."  

Non-ICCIE elective courses include three types of certificates in healthcare risk management from the American Society for Health Care Risk Management, as well as seven courses from The Institutes on a smattering of subjects that include commercial insurance, insurer accounting and finance principles, underwriting, commercial property risk management and insurance, and commercial liability risk management and insurance. 

One new offering is a tax course that was in development for a few years and has proven to be a popular addition. "We had toyed for a brief time with an offshore tax course, but we really felt we needed a full tax course start to finish," Cantor says. "I've gone to a million conferences over the years, and there's almost always a tax session. And it's almost always very well attended." 

Since the captive insurance industry is always changing, along with the laws pertaining to this space, Cantor says "every single iteration of each course is reviewed to make sure that it's not outdated. So, we never actually offer the same course exactly the same way twice." 

ICCIE often enlists the assistance of peers outside of the organization to review its coursework and is constantly on the lookout for new courses to add.  

A work group is currently exploring a CCI program for the European market, which coincides with the recent introduction of a webcast that solely deals with this topic. "We're looking at having a European version of the CCI sometime in the next few years," he says, noting that it involves quite a bit of coordination between the United States and Europe.  

Green Mountain Growth 

Cantor started with ICCIE in May 2004, and he describes his home state then as "the industry's 800-pound gorilla, especially domestically." Captives were seen as a clean industry with ingenious ideas, great-paying job opportunities, and staying power, he says. That strength was seeded by a growing need for an alternative to the traditional insurance market, which was failing to tamp down rising costs.  

Today, the Green Mountain State still leads the way with 707 licensed captive insurance companies (677 active and 30 dormant). Vermont is now among more than 30 US domiciles for captives, including territories and additional jurisdictions.  

Cantor recalls several other states that began following Vermont's lead by emerging one after another to become dependable US domiciles for captives. Industry professionals now enjoy the luxury of having many great choices to be made that stem from the industry's organic growth, he says. 

With that growth came the need for more education and serious attention to detail with regulators and domiciles, according to Cantor.  

In recent years, Cantor has seen breathtaking growth in medical stop-loss captives and believes risk managers are willing to explore every possible opportunity they can to help make health benefits more affordable for their companies as well as employees. He cites an ICCIE healthcare course that industry professionals regularly attend every year, alongside other courses, to learn more about captives as a way to help bend the employee health benefits cost curve.  

"Captives are just seen as one more tool in the toolbox," he says. "For some, it fits perfectly. For some, it doesn't fit at all. As long as it's done right, it can be the right solution. But what's right one year might not be right 3 or 5 years down the line, either because the organization changes or the laws change."  

Whatever captive structure is chosen is determined in large part by a company's risk appetite. With that in mind, Cantor says those whose organization is just starting out on their alternative risk transfer journey may initially explore curricula around a group captive, then eventually look into a single-parent captive as they decide to bear more risk.  

The importance of these educational efforts is magnified in the face of significant demographic changes on the horizon. "We need a good way to economically, and in short order, get many new people into the industry, because in just a few years, there's going to be a lot of people retiring in risk management, which, of course, includes the captive industry," Cantor observes. "So, I want to make sure we have enough qualified people in the industry because unqualified people mean bad things will happen."  

Sidebar… 

Love of Music Takes Center Stage 

Mitch Cantor isn't just devoted to educating insurance professionals about the captive insurance space. He's also a songwriter, musician, music aficionado, and entrepreneur. 

Cantor, who has written songs since he was a teenager and began performing in college, worked on a few records in the late 1980s. In 1995, he set up his own label called Gadfly Records, whose mission is to promote obscure, unique, and offbeat projects.  

But the timing wasn't great. Like the rest of the record business, his inability to anticipate the enormous impact of Napster's digital music platform torpedoed the best-laid plans. So, in realizing the end was coming for the retail record industry, Cantor pivoted—taking on the role of running a community theater company.  

More recently, he has written a musical with 25 songs called "The Decomposeurs" based on a screenplay he penned but couldn't sell about a group of present-day advertising executives caught in an industry downturn in their late 50s who are too old to relocate or reinvent themselves but too young to retire. "So, out of desperation, they form a rock band and write sardonic songs about getting older," he says. 

Among some of the famous folks he recruited to write songs for the project are actor Kevin Bacon; Kimberley Rew, who wrote "Walking on Sunshine"; and Jeff Silbar, who wrote "Wind Beneath My Wings."  

Cantor also shot a documentary about the art of songwriting, featuring interviews with 10 hit songwriters who are not household names. He's currently trying to find a streaming partner to acquire the rights to the songs featured in the film.  

"I've always been interested in hit songs, especially from songwriters who are not very well known," he says. "For instance, you know, everyone knows Madonna did 'Like a Virgin,' but not many people know who wrote it unless you're really in the music business. It's Billy Steinberg, who wrote a lot of other hits as well."

Courtesy Photos of Mitch Cantor