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Single-parent captives: what the parent takes on

A single-parent captive — called a pure captive in many statutes — is an insurance company owned by one organization to insure its own risks and, where the domicile allows, those of its affiliates. The parent keeps the control and the results, good and bad, without pooling with other owners.

A captive primarily insuring the risks of one parent organization and related entities.

2 active providers

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What stays with the parent

Forming a pure captive moves risk into a company you own; it does not move responsibility away from you. The table sets out what the parent continues to carry.

AreaWhat the parent is responsible for
Capital and surplusMeeting the domicile’s minimum and any higher amount the regulator requires for the business written
GovernanceA board, meetings and decisions in the domicile, with any resident-director rules
Regulatory filingsAnnual statements, audits, actuarial opinions and business-plan changes, usually through a captive manager
ResultsEvery loss in the retained layer, including adverse development years later
Service providersChoosing and overseeing the manager, actuary, auditor and counsel

Compared with a group captive or a protected cell, you give up shared costs in exchange for sole control. Whether the numbers work is a feasibility question, covered in the captive feasibility study guide.

Benefits and limitations

Potential benefits

  • Full control over policy wordings, claims decisions, underwriting and investment of the captive's assets.
  • Underwriting results belong to the parent alone; nothing is shared with other owners.
  • Can insure exposures the commercial market prices poorly, once the regulator accepts the program.
  • Direct access to reinsurance markets.

Key considerations and limitations

  • The parent carries the full fixed cost of a licensed insurer: capital, management, actuarial opinion, audit and filings.
  • No pooling: a bad year lands on the captive's reserves and, behind them, the parent.
  • It needs board-level governance and continuing regulatory engagement, not a one-time set-up.
  • It is economical only when premium is large enough that fixed costs are a small share of it.

Is this relevant to me?

When it may be worth exploring

  • Your organization can absorb the fixed cost of running a licensed insurer alone.
  • You want sole control over program design, claims and investments.
  • Several related entities have risks that could be consolidated in one vehicle.
  • Your loss record is strong enough that you would rather keep the results than share them.

When it may not fit

  • Fixed costs would be a large share of the program.
  • You would rather have the cost-sharing of a multi-owner structure.
  • No one internally can govern a licensed insurer and its filings.

Frequently asked questions

Usually. Some domiciles build an approved captive manager into the licensing process — Vermont's formation steps, for example, begin with engaging one — and even where it is not required, owners commonly outsource day-to-day management because it calls for regulatory, accounting and local expertise. The manager typically handles regulatory filings, accounting, board support and coordination with the actuary and auditor. Rules on self-management differ by domicile.

It depends on the domicile, the structure and how complete the application is. Formation usually follows a feasibility study, then a business plan and license application reviewed by the domicile's regulator. Arrangements that need a fronting insurer or reinsurance can take longer, because those parties carry out their own due diligence and set collateral terms. Your captive manager and the domicile regulator can tell you what current timelines look like.

It depends on the domicile, the type of captive and the risks it writes. Domiciles set minimum capital and surplus requirements in law, and they differ by captive type; Vermont, for example, sets minimums by class and lets the commissioner require more. In practice the amount is often driven by the actuarial analysis of the risk being retained and the regulator's review of the business plan, and it can be well above the statutory minimum.

Providers for Single-Parent Captive

2 companies

Oct 21, 2026How are these providers ranked?

Artex Risk Solutions

Unclaimed
No reviews yetartexrisk.com3rd Floor, Wessex House, 45 Reid Street, Hamilton HM 12, Bermuda
  • Risk Consulting
  • Underwriting
  • Enterprise Risk Management
  • Captive Feasibility Studies
  • Actuarial Services
  • Captive Management Services

Artex Risk Solutions is an alternative risk and insurance management business operating under the Arthur J. Gallagher & Co. group. It provides captive feasibility, formation and ongoing management; single-parent, group and cell captive solutions; actuarial and risk advisory services; reinsurance and claims-management support; capital-markets administration; and legacy and run-off solutions.

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Risk Services, LLC

Unclaimed
No reviews yetriskservcos.com1605 Main Street, Suite 800, Sarasota, Florida 34236, United States
  • Risk Consulting
  • Captive Feasibility Studies
  • Underwriting
  • Regulatory Compliance
  • Captive Management Services
  • Captive Accounting
  • +1 more

Risk Services, LLC is a full-service captive insurance manager providing formation, licensing, accounting, financial reporting, regulatory compliance, underwriting, policyholder administration, reinsurance intermediary and fronting support services.

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