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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VCIA Letter Addresses IRS Treatment of Micro-Captives

The Vermont Captive Insurance Association (VCIA) has spoken out about the US Internal Revenue Service's (IRS) treatment of micro-captives. In a letter to US Treasury Secretary Steven T. Mnuchin and IRS Commissioner Charles Rettig, VCIA President Richard Smith says a March 20, 2020, IRS letter raises concerns about IRS tactics.
May 01, 2020 Read More
  Captive Globe-SF

May "CICR" Looks at Risk Management, Captive Implications of COVID-19

Don't miss the May issue of "Captive Insurance Company Reports" ("CICR"), in which John Thomson, "CICR" editor, discusses the ramifications of the novel coronavirus (COVID-19) and the risk management implications, including a role for captives.
May 01, 2020 Read More
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Analysis Says COVID-19 BI Losses Dwarf Insurance Industry Premiums

An updated analysis suggests that monthly COVID-19-related business interruption (BI) losses for US businesses with fewer than 500 employees could range as high as $668 billion per month. Those numbers dwarf the premiums for commercial property risks in the key insurance lines which are estimated at $4.5 billion per month.
April 30, 2020 Read More
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COVID-19 Pandemic's Economic Fallout Will Test Cyber Insurance Market

While property-casualty insurers continue to view cyber insurance as an attractive growth opportunity, economic fallout from the COVID-19 pandemic will test the US cyber insurance market, according to Fitch Ratings. The economic fallout from COVID-19 will likely affect recent premium revenue trends and the industry's claims experience.
April 30, 2020 Read More
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Why Underwriting Discipline Is Critical for Captives

The current insurance climate makes it imperative that captive insurers practice some type of underwriting discipline. This article lays out the reasons for maintaining an underwriting profit and what it takes to do so.
April 29, 2020 Read More
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Investment Volatility Is Eroding 2019 Global Reinsurance Capital Gains

Total capital dedicated to the global reinsurance industry grew 15 percent year-on-year in 2019, standing at $605 billion at the end of the year. Much of that capital growth has likely unwound thus far in 2020, however, due to the steep sell-off in the stock and corporate bond markets.
April 29, 2020 Read More
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Captives Offer Options as Property Owners Face Hardening Market

Faced with a hardening insurance market, owners of multifamily housing properties are now working through renewals that bring sharp increases in rates, larger deductibles, and a decrease in capacity. When addressing all these factors, owners are starting to think more about self-insuring these risks.
April 28, 2020 Read More
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COVID-19 Forces Cancellation of 2020 Rendez-Vous Reinsurance Event

The 2020 Rendez-Vous de Septembre international reinsurance industry conference has been canceled due to uncertainties surrounding the global COVID-19 pandemic. The event had been scheduled for September 12–17 in Monaco and would have been the 64th such annual industry meeting.
April 28, 2020 Read More
  Business Card with Word Pandemic Held in Businessman

Captive Insurance Could Provide Solutions to Some Pandemic Risk Issues

For all the challenges the COVID-19 pandemic is presenting to businesses, the insurance industry, and society, like other crises before it the pandemic might ultimately create opportunities for captive insurance. A recent Strategic Risk Solutions webinar titled "Captive Insurance Response to a Pandemic" explored this topic.
April 27, 2020 Read More
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AXA XL Announces New Leadership Team, Proposed Operational Changes

AXA XL recently announced a new leadership team and proposed changes to the operating model of its insurance business following a strategic review. Among the most significant changes to the operating model are the creation of a single global insurance underwriting function and the establishment of three geographical business units.
April 27, 2020 Read More
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