Alternative Risk Financing & Captives

WE KNOW ALTERNATIVE RISK FINANCING & CAPTIVES

Effectively manage your cost of risk with Integro’s efficient, dynamic program solutions. We offer customized plans based on your organization’s unique needs, business objectives, and regulatory requirements. Integro works with you to identify optimal risk finance and contingent capital plans at an affordable cost.

Alternative Risk Financing & Captives Key Facts

The purpose of captive insurance is to cover all or some of the owner’s risk and procure these advantages:

  • Lower total cost of risk
  • Reduced reliance on the commercial insurance market
  • Coverage for uninsurable risks
  • Cash flow matching of revenues & expenses
  • Risk management performance measurement

CAPTIVE AND RRG FORMATION AND CONSULTATION SERVICES

Risk retention group (RRG) or captive? Group or single-parent captive? Direct or fronted? Risk financing vehicle or tax-efficient insurer? Domiciled onshore or offshore? Capitalized with cash, a letter of credit or even a parental guarantee?

Creating an efficient RRG or captive is dependent upon several key decision points, the most important of which is:

"Is a captive or RRG the most efficient alternative given my organization’s challenges and objectives?"

Dedicated Integro consultants in the U.S. and Canada are available to guide you through these critical decisions and more with balanced and unbiased advice. Our feasibility process is designed to determine the most efficient structure according to each client’s unique profile and, importantly, to prepare the organization to operate a successful captive/RRG well into the future.

LONG TERM SUPPORT FOR CAPTIVES AND RRGS


Captives and RRGs are long-term solutions and we believe it is imperative to share that long-term view throughout the feasibility process by preparing our clients to get the most out of their captive/RRG well beyond the implementation date.

For this reason, Integro offers a full range of services from basic education to governance recommendations for existing captives/RRGs. Our feasibility studies customarily include:

  • Stakeholder meeting to discuss captive/RRG concept
  • Discussion of captive/RRG merits and potential disadvantages as compared to competitive alternatives
  • Forecasts of expected loss activity for each coverage under consideration
  • Evaluation of risk tolerance and likely attachment points
  • Recommendation of optimal program structure including coverages, limits, reinsurance and fronted vs. direct placement considerations
  • Outline of relevant IRS and court precedents relating to tax deduction of premiums paid1
  • Estimates of all captive start-up and annual operating costs, including capital requirements
  • Preparation of five-year financial pro formas
  • Full domicile evaluation and recommendation
  • Documentation of rationale for captive formation
  • Design of Board presentation for final approval
  • Vendor selection (captive manager, legal counsel, auditor, actuary, investment manager)
     

After formation, Integro personnel are routinely involved in assuring the continued success of our clients’ captives/RRGs. These consulting projects are typically performed ad hoc as needs arise and may include:

  • Evaluation of captive/RRG expansion opportunities (additional coverages, increased limits)
  • Outlining sub-committee structures and responsibilities
  • Establishing Board composition and tenure standards
  • Determining capital adequacy standards
  • Attending annual captive meetings
  • Developing key performance indicators and monitoring dashboards
  • Release of surplus recommendations
  • Re-domiciling efforts
  • Evaluating loss portfolio transfers or other alternative risk mechanisms

Let’s start a conversation.

Tell us what you’re looking for. One of our experienced brokers will reach out with coverage options and answers.