Recently, at the Guernsey London Insurance Forum, Oliver Schofield, executive director of reinsurance broker RKH, and other experts noted that, as the captive business has developed worldwide, most large enterprises—such as Coca-Cola, BP and Shell—have already established captive insurers, prompting many insurance brokers to target small and medium-sized enterprises.

       Guernsey is developing the "producer-owned reinsurance company (PORC)" model to provide customized reinsurance arrangements for smaller clients. A PORC is an organizational form similar to a cell captive, established by a (re)insurance broker or other insurance intermediary, that meets the needs of clients whose business volume is too small to justify the cost of a cell captive but who wish to share in underwriting profits.

        Over the past five years, as the captive market has become increasingly saturated and the insurance market has softened, captive domiciles have focused their attention on small and medium-sized enterprises. But apart from cell captives, Guernsey and other offshore captive domiciles have found no way to compete with U.S. group captives and the 831(b) tax election. Guernsey has therefore focused its captive development efforts on insurance-linked securities, and the PORC model is an innovative captive model promoted by Guernsey.

Source: www.captivereview.com