Types of Captives

These are companies with a single owner to whom they provide insurance coverage. A risk manager or financial officer at the parent company typically monitors them. A domiciled captive insurance manager manages the captive.

Association captive formations are generally established by trade association or members of an industry to provide insurance coverage for members. Ownership rests with the association or individual members. Liability risks such as medical malpractice and other associations are usually insured in this way. They usually have a financial expert at the association level with prime responsibility, or outsource this function to a captive insurance manager.

Industry captives are owned by organizations within the same industry that have come together to solve a specific insurance problem The stock holder commonly appoint a board of directors to whom the management {company} reports.

Diversified captives underwrite unrelated risks further more to the parent organizations business.

Agencies captives are compose by insurance brokers or agents to facilitate them to participate in the high-quality risks, which they control. These are rarely used because of legislative mandates concerning agent liability.