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Alternative Funding and Captives
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Alternative Funding structures (including captives) offer an insured or group of insureds a
mechanism whereby they can benefit from better than expected experience in an insurance program.
These structures in concert with Loss Control and various Risk Management tools allow both the
insured and the insurance carrier to obtain the lowest net insurance costs related to the risk
exposures.
Alternative Funding structures include (but are not limited to):
- Deductibles (both large and small).
- Rent-a-Captive Arrangements.
- Association Captives.
- Owned Captives.
- Risk Retention Groups.
- Risk Purchasing Groups.
- Fully Funded Arrangements.
- Self-Insured Retentions.
These structures can be used individually or in combination with each other in developing the
most efficient way to reach the insured’s goals.
Factors contemplated in the selection of the best approach for your association, group, or
client include:
- Number of insureds—individual insured or group of insureds.
- Insurance line of business and level of premiums charged.
- Regulatory issues.
- Carrier’s attitude regarding alternative funding.
- Insured’s loss experience and loss control efforts.
- Insured’s financial position.
- Insured’s appetite for risk.
Intercorp has a wide range of experience with all of these various alternative funding devices
and provides its clients with valuable input and guidance in selecting the appropriate structure
for any given program.
Let us help you. For a brief primer of alternative market terms, please
click here.
Click here to read "Why Form a Captive or Risk Retention Group for Your Association?" from
the 3rd Quarter 2005 issue of The DC Captive Insurance Newsletter.
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