Captivating captives
Article Abstract:
Captive insurance companies, which have traditionally done well only when conventional insurance is not an option, are continuing to prosper even in the current soft insurance market. Owners of captive companies are using them to finance higher risk exposures. The number of captive companies has increased from 2,458 worldwide in 1988 to 3,280 in 1992. An increasing number of captives are being created onshore, because of changes in tax laws and other regulatory frameworks.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1992
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Alternative directions
Article Abstract:
The alternative insurance market impacts the normal economic cycle of the insurance industry in many ways. Insurers need to understand this impact in order to operate effectively. In the commercial lines market, alternative insurers increased their share of the market from 9% in 1970 to 23% in 1980. By the year 2000, this share is expected to have grown to 38%. The alternative market shifts the levels of supply and demand by keeping prices down and insurance available.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1992
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High stakes in the alternative market
Article Abstract:
The alternative risk-financing market is estimated to be about $50 billion in annual premium volume. Two reasons why there is so much business for this market are that alternatives have lower expense ratios and tend to have more concentration in difficult underwriting risk. Examples of financing techniques include the use of captives, risk retention groups, protection and indemnity clubs, trusts and private insurers.
Publication Name: Best's Review Property-Casualty Insurance Edition
Subject: Insurance
ISSN: 0005-9714
Year: 1992
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Comment about this article or add new information about this topic:
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