Bring creativity to risk management.
Artex manages in excess of 500 Single-Parent Captives with premium sizes ranging from $300,000 to over $100 million. These captives are supported by one of the most experienced teams in the market, with expertise in all aspects of incorporation and management as well as redomiciliation and exit strategies. Our goal is to ensure that parent companies lock in the long-term value a Single-Parent Captive offers as an alternative risk transfer solution.
A Single-Parent Captive or Pure Captive is owned and controlled by one parent and insures the risks of the parent company and its affiliates. The captive operates as an insurer for its parent company or group, underwriting all or a portion of the risks of its owners. Virtually any line of coverage can be handled through a captive. The parent provides risk capital and premiums to the wholly owned structure in return for the cover the captive provides. In the event of a claim, the captive will pay the loss to the parent company.
Single-Parent Captives are increasingly being used to write third-party insurance, including joint ventures and customer-centric insurance schemes which, in essence, create new revenue streams for the captive sponsors and transform a captive into a profit-generating entity.
In addition, Single-Parent Captives are becoming a viable alternative solution in bridging the gap that exists in cyber liability risks between individual exposures and the coverage that’s available in the traditional marketplace.
Advantages of a single-parent captive.
- Provides flexibility to handle changing risk financing needs
- Facilitates business planning and cost allocation
- Offers greater ability to measure risk management program
- Provides direct access to reinsurance markets
- Receives potential tax savings
- Provides ability to set reserves for loss exposures
- Offers ability to control investment income
- Development of tailored insurance policies
- Ability to overcome exclusions or other market restrictions
- Delivers more responsive and broader coverage options
- Increases negotiating power with the commercial market at renewal
Artex works closely with clients, agents and brokers to confirm whether a captive is a viable and feasible option by conducting a full assessment of the company’s risk profile to compare the costs and benefits of forming and operating a single-parent captive against the costs and benefits of other alternatives for the financing or insuring of specific risk exposures.
The captive market.
The Single-Parent Captive is the foundation of today’s captive insurance market. Since the early part of the 20th century when the first captive-type structure was formed, the concept has evolved to address the ever-changing demands of the corporate environment, and today approximately two-thirds of all captives are Single-Parent Captives.
Our Captive Consulting division, comprised of qualified and highly experienced specialist insurance and finance practitioners, ensures that every component of the captive is effectively structured and precisely aligned with a client’s risk and overall business objectives from day one.