Offshore Captive Insurance Companies
A captive insurance company is a an insurance company that insures some or all of the risk of its parent company. It may also insure the risks of the parent company`s clients. Using captive insurance companies is a risk management tool by which a business creates its own insurance company subsidiary to finance its retained losses in a formal structure.
Types of captive insurance companies
- Single Parent Captive - an insurance or reinsurance company formed mainly to insure the risks of its non-insurance parent or affiliates.
- Association Captive - a company owned by a trade, industry or service group for the benefit of its members.
- Group Captive - a company, jointly owned by a number of companies, created to provide a vehicle to meet a common insurance need.
- Rent-A-Captive - a company that provides 'captive' facilities to others for a fee, while protecting itself from losses under individual programs, which are also isolated from losses under other programs within the same company.
- Agency Captive - a company owned by an insurance agency or brokerage firm allowing the reinsurance of a portion of their clients risks through that company.
Benefits of offshore captive insurance companies
- Tax benefits
- Reduced insurance costs
- Enhanced risk management
- Direct access to reinsurance markets
- Flexibility
Main captive domiciles
- Belize
- Bermuda
- Cayman Islands
- Ireland
- Guernsey
- Singapore
- Luxembourg
- Barbados
- Malta
- Anguilla
- BVI
