FAQ

What is a Captive?

Captive insurance, also called "alternative" insurance is essentially the insuring of one's own risk. The most recognized and formalized way of achieving this self insurance is by the ownership of a captive insurance company. This is typically a dedicated, wholly owned insurance company that insures (or reinsures) the risks of the parent company, sister companies, customers, suppliers or affiliates.

How big is the captive market?

The "alternative" insurance market is now estimated at 40% of the total insurance market. Worldwide there are over 4,300 captive insurance companies writing in excess of $50bn per annum in premium income.

Is a captive right for us?

Since the late 1970's many companies, association groups, and tax exempt organizations have recognized the benefits of insuring their own risks in a captive. The implementation of a successful captive program requires a commitment of time, capital and a corporate-wide philosophy of risk reduction and abatement.

How much does it cost?

This depends on the domicile chosen and the level of activity in the captive. The range of costs are shown below:

Insurance management fees:	$25,000 to $75,000
Audit fees:	$10,000 to $30,000
Government fees:	$2,000 to $10,000
Other costs:	$5,000 to $25,000

Capital

(see domicile pages)