Captive Insurance News

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  • Reinsurance Sector Won't Earn Cost of Capital in 2020 Due to COVID-19 The global reinsurance industry will fail to earn its cost of capital in 2020 due to the impact of the COVID-19 pandemic, according to Fitch Ratings. Fitch noted that the COVID-19 crisis comes after 3 years of heightened natural catastrophe losses and increasing US casualty claims.
  • COVID-19 Pandemic Slows Pace of Captive Insurance Law Updates While the COVID-19 pandemic has slowed state legislatures' updates of their captive insurance statutes this spring, some states have moved forward in 2020 and passed captive legislation. In other captive domiciles, state lawmakers did not complete action on captive legislation before adjourning.
  • Legislation To Create TRIA-Like Federal Pandemic Backstop Introduced A bill that would create a federal pandemic risk backstop has been introduced in Congress. Rep. Carolyn B. Maloney (D-NY), senior member of the House Financial Services Committee, introduced H.R. 7011, the Pandemic Risk Insurance Act of 2020, on Wednesday.
  • US Property-Casualty Market Hardening Continues in First Quarter: CIAB Commercial property-casualty insurance markets continued to harden in the first quarter of the year, with some lines seeing their largest increases since the September 11, 2001, terrorist attacks, according to the Council of Insurance Agents & Brokers (CIAB). Premiums increased by an average of 9.6 percent in the first quarter.
  • FERMA Seeks EU Financial Resilience Framework for Catastrophic Risks The Federation of European Risk Management Associations (FERMA) has called on the European Commission to create a European Union business interruption resilience framework for catastrophic risks. FERMA called on the commission to address the "severe shortage" of business interruption insurance for disruptions that don't involve physical damage.
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  Money and an Hourglass

Insurance Groups Offer Alternative Pandemic Backstop Proposal

A group of insurance trade associations has proposed a new federal program that would provide revenue replacement for businesses affected by future pandemics. The taxpayer-backed Business Continuity Protection Program would provide participating businesses with revenue replacement assistance for payroll, employee benefits, and operating expenses following a presidential viral emergency declaration.
May 22, 2020 Read More
  A stethoscope wrapped around a small stack of $100 bills.

Life/Health Cat Bonds Likely Most Affected by COVID-19: A.M. Best

Life/health-related catastrophe (cat) bonds face the greatest risk of losses from the COVID-19 pandemic, compared with other insurance-linked securities (ILS), according to A.M. Best. Best suggests that the COVID-19 pandemic's overall impact on the ILS market—including most catastrophe bonds—should be limited.
May 22, 2020 Read More
  Webinar Series Spelled Out in Multicolored Letterpress

ICCIE Webinars Focus on Regulators' Views of COVID-19 and Captives

The International Center for Captive Insurance Education (ICCIE) has scheduled two hot-topic webinars focused on how regulators are addressing the COVID-19 pandemic and captive insurance companies. The first webinar focuses on captive insurance companies during the pandemic and the second looks at captives after the crisis.
May 21, 2020 Read More
  Negative Trend 480x377

S&P Revises Global Reinsurance Outlook to Negative on COVID-19 Impact

COVID-19 pandemic has led S&P Global Ratings to revise its outlook for the global reinsurance industry to negative from stable. S&P said that pandemic-related losses combined with volatile capital markets and lower investment returns will likely prevent the global reinsurance sector from meeting earnings expectations.
May 21, 2020 Read More
  Businessman Hands Holding Human Brain Output

Artificial Intelligence Brings Risk Management Opportunities, Risks

Artificial intelligence (AI) can provide opportunities for organizations to improve their risk management but also may create some new risks. Risk managers need to consider how to integrate risks generated by AI into the enterprise risk management process and how to understand the scope of AI risks.
May 20, 2020 Read More
  A rope being pulled apart and breaking with the word stress in the middle of the break

COVID-19 Stress Test Finds Most Insurers' Capital Levels Adequate

Stress testing gauging the COVID-19 pandemic's impact on insurance companies' financial strength found most insurers' capital levels provide an adequate buffer against potential balance sheet shocks. A.M. Best analyzed approximately 1,400 rated insurers worldwide, focusing on the impact of COVID-19 on insurers' underwriting and assets.
May 20, 2020 Read More
  natural disaster icons-SF

2020 Catastrophe Bond Volume Remains Strong Despite Pandemic

The COVID-19 pandemic appears to be doing little to slow issuance of catastrophe bonds and other insurance-linked securities, with issuers bringing $6.1 billion to market thus far in 2020, according to data from the Artemis Deal Directory. There has been $1.06 billion in issuance so far during the second quarter.
May 19, 2020 Read More
  Man holding globe with COVID-19 virus around it

New Triple-I Initiative Offers Resource on Insurance and Pandemic

The Insurance Information Institute (Triple I) has launched an initiative providing an educational resource with regard to insurance and the COVID-19 pandemic. The Future of American Insurance & Reinsurance campaign will focus on ensuring the insurance industry can sustain its role contributing to economic growth and stability.
May 19, 2020 Read More
  Three Professionals Contemplating Future

Hard Market, Industry Disruptions Create Captive Opportunities

With a traditional insurance market that appears likely to continue hardening, and that market facing disruption from events like the COVID-19 pandemic and potential new competitors, there are opportunities for captive insurance companies. Changes in market rates are drivers of alternative risk transfer activities, including captive insurance companies.
May 18, 2020 Read More
  Image of New Legislation Introduced

Oklahoma Legislation Specifies Captive Premium Tax Distribution

Legislation approved by Oklahoma lawmakers and signed into law May 19 by Governor Kevin Stitt specifies how premium taxes paid by captive insurance companies must be allocated by the state insurance commissioner.
May 18, 2020 Read More
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