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A captive’s board, when composed of a combination of appropriate individuals from the insured and expert independents, plays an essential role by holding the captive’s operation to account, providing independent oversight and expert insight. Independent directors are key to demonstrating and delivering the substance, good governance and independence increasingly demanded from regulators and tax authorities around the world.
Captive boards commonly contain representatives from the parent organisation. Captive non-executive directors provided by the parent’s treasury, legal or company secretariat function may provide an independent view from the risk and insurance management function, but their employment by the captive’s key (or only) policyholder means that true independence must be sought further afield.
It is the role of these independent non-executive directors (iNEDs) that is the subject of this Guide.
There is no prescriptive or ‘one size fits all’ approach to forming or refreshing a captive board, but this guide has been designed as a resource for individuals currently serving as directors on captive boards or considering an appointment in the future. The guide also contains valuable information for captive managers and captive owners when they are considering new appointments to the board.