Rent-a-Captive Programs
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Product Solutions Guaranteed Cost Workers Compensation
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Account Size $250,000 to Unlimited A rent-a-captive is a captive insurance company that can be used or “rented” by unrelated insureds. It allows insured to gain the benefits of a captive insurance arrangement without actually participating in the ownership or management. Under the Fully Funded product, an insured is offered an insurance policy underwritten by the insurance carrier. A rent-a-captive is then selected to serve as a reinsurer of the insurance carrier. The insured remits its premium to the carrier, which deducts the program's expenses and cedes the balance (loss fund) to the selected rent-a-captive facility. The insured then remits cash and/or a letter of credit to the rent-a-captive for the difference between the loss fund and the aggregate limit of its policy. If a letter of credit is provided to secure the aggregate limit, it must be clean, irrevocable ever greened and from an approved financial institution. The letter of credit and/or cash is accessed to reimburse the insured for any claims that are submitted. Any funds remaining in the rent-a-captive facility are returned to the insured. |
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