Captive Research

Industry research reports, special topics and regulatory interpretation

Risk mitigation plays central role in event coverage

Prevention has become the focus of underwriters and policyholders in the entertainment sector in response to the Oct. 1, 2017, mass shooting during a Las Vegas country music festival.

2018-07-04

Author：captive.org/chinacaptive.org
The Development of Comprehensive Risk Management Theory

The concepts of internal control and risk management gradually emerged, developed, and were refined in practice. In the 1930s, affected by the worldwide economic crisis of 1929–1933, about 40% of banks and enterprises in the United States went bankrupt, and the economy regressed by about 20 years. To cope with the business crisis, many large and medium-sized U.S. enterprises set up internal insurance management departments responsible for arranging the enterprise's various insurance programs. It can be seen that internal control and risk management at that time mainly relied on insurance.

2016-07-17

Author：captive.org/chinacaptive.org
Applications of Enterprise Comprehensive Risk Management (Comprehensive Risk Management)

　　The so-called comprehensive risk management refers to the process and methods by which an enterprise, centered on its overall business objectives, executes the basic procedures of risk management in every link of enterprise management and throughout the operating process, cultivates a sound risk management culture, and establishes and improves a comprehensive risk management system—including risk management strategy, risk financing measures, the organizational and functional system of risk management, risk management information systems, and internal control systems—thereby providing reasonable assurance for achieving the overall objectives of risk management.

2016-07-17

Author：captive.org/chinacaptive.org
What Is Captive Insurance?

The emergence of captive insurers can be attributed to the growing instability and unpredictability of modern economic life. In today's ever-changing economic environment, the supply and premium rates of the traditional insurance market are extremely unstable and subject to great uncertainty. Managers of commercial companies hope to find a new way to control those unpredictable risks. As a way of pooling emergency reserves, captive insurance can usually take advantage of more favorable tax conditions and has become a driving force in the development of innovative risk financing today.

2015-11-07

Author：captive.org/chinacaptive.org
Alternative Risk Transfer (ART) and Captive Insurance

In today's world, the risk management landscape facing enterprises is constantly changing, from structural economic changes to changes in the legal and security environments, along with the emergence of various new types of risk, such as high technology, globalization, deregulation, and geopolitical shifts. The increase of various new risks continually challenges the limits of insurability; new risks are characterized by insufficient market information and a lack of historical loss experience data, and how to manage dynamic risks poses an even greater challenge to insurers. Excluding special risks, catastrophe risks, and trend-based fundamental risks from the scope of insurable risks can no longer meet the growing risk management needs of enterprises facing a constantly changing economic environment.

2015-11-07

Author：captive.org/chinacaptive.org
The Origins of Captive Insurance

The emergence of captive insurance has a certain historical inevitability: it arose from the traditional insurance market's inability to meet enterprises' needs for coverage of specific risks. It originated in the 1920s–1930s, a period when mutual insurance companies and reciprocal insurance companies were on the rise; however, it only grew rapidly in the early 1950s with the rise of offshore financial markets. Thanks to tax advantages, captive insurers continued to prosper from the 1960s to the early 1970s. In the late 1980s, insufficient underwriting capacity in the commercial liability insurance market sparked yet another wave of growth for captive insurers. Today, the number of captive insurers worldwide has reached 6,876—far exceeding the number of traditional commercial insurance companies—and their premium income accounts for 10% of global property insurance premiums. With the continuous improvement of alternative risk transfer techniques, captive insurers have become an important enterprise-wide risk management tool complementary to traditional commercial insurance.

2015-11-07

Author：captive.org/chinacaptive.org