Plain-language articles, guides, FAQs and glossary entries on captives and other ways of financing risk. Start with a short definition, read a full explainer, or use a practical guide when a decision is close.
New to captives and risk financing? Read these two first: an overview of how organizations retain and transfer risk, and an explanation of what a captive insurance company is.
A captive is a licensed insurance company owned by the business or group whose risks it insures. Here is how one works, the main structures and what owning one involves.
Risk financing is how an organization pays for the losses it cannot prevent. This guide maps the options from retention to transfer and shows where captives fit.
A firm that runs a captive insurer's day-to-day operations under contract. It does not own the captive or carry its insurance risk.
The jurisdiction where a captive insurer is licensed and whose insurance regulator supervises it.
In a fronting arrangement, a licensed insurer issues the policy and reinsures some or all of the risk to a captive. Here is who does what, why collateral matters and what to ask before signing.
A licensed insurer that issues a policy and reinsures the risk to a captive.
A captive feasibility study tests whether forming a captive makes financial and operational sense. This guide covers what to prepare, who does the work, what to test and how to read the report.
An estimate of the cost of claims for losses that have already happened but have not yet been reported.
A single company whose assets and liabilities are divided into legally segregated cells, kept apart from each other and from its core.
Risk financing is how an organization pays for the losses it cannot prevent. This guide maps the options from retention to transfer and shows where captives fit.