The risk-intelligent captive: Roundtable discussion hosted by Artex and Airmic

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In recent years, the hardening commercial insurance market has prompted captive owners to get more from their risk retention vehicles. It has also seen a growing number of corporations consider captive insurance for the first time as well as driving significant innovation within the alternative risk transfer solutions arena.

While captives were traditionally used for a parent company’s more ‘vanilla’ risks, this is changing. As the risk landscape becomes more intangible, with less capacity for more complex risks within the commercial insurance market, captives are proving a natural home for some of these.

For political risk and cyber, for instance, the parent company is often better placed to understand some of their exposures and take concrete steps to mitigate them. Other benefits include the captive being used as a risk incubator and offering more confidence to insurance and reinsurance partners that these risks are being actively managed and are therefore better than their peers.

This white paper considers the evolution of the risk-intelligent captive and draws on the highlights from the ‘Insuring the Future’ roundtable discussion hosted by Artex and Airmic in November 2023. It will explore how captive owners can open up their risk retention vehicles to more complex risks, what steps they can take to mitigate some of the more extreme risk scenarios, and the innovative solutions and partnerships that can be achieved.