The Captive Insurance Industry in the Cayman’s Sets Record Premiums
Last month, we spoke about how increasingly more states are allowing the formation of captive insurance companies. To date, there are 31 states that allow captives to be set up within their borders, with the Lone Star State as the most recent to pass legislation.
But captives also have a long history in the Cayman Islands, with the industry reaching an all-time high of $13.5 billion in total premiums and $82.8 billion in total assets as at June 30, 2013. According to the Cayman Islands Monetary Authority (CIMA), these figures are up 52% and 5% percent respectively over the same period in 2012, which already had been considered a banner year for growth in the industry.
The Cayman Islands is the second-largest domicile for captives in the world, and in existence since the 1970s. And while the Cayman Islands are best known for healthcare captives, many other lines of business are also written, specifically workers compensation, property and general liability.
In its recent release, the CIMA reported that they oversee 750 class B, C and D companies as of June 30, 2013, with 412 of those pure captives and 134 as segregated portfolio companies (SPCs).
The chairman of the Insurance Managers Association of Cayman (IMAC), Rob Leadbetter, who reviewed CIMA’s stats, said: “2012 was considered a year of phenomenal growth for Cayman captives with 20 new licenses granted in the first two quarters (53 for the whole year), and over the same period this year, we have attracted 24 new captives. This is very encouraging and demonstrates the fact that Cayman continues to attract solid business because of its high level of transparency and regard for international regulatory initiatives and its history of integrity.”
In fact, the majority of captives are from North American-based companies, with 34% relating to medical malpractice and 21% covering workers compensation. IMAC is non-profit organization run by the insurance managers of the Cayman Islands.
The captive industry is thriving with many insureds looking to take greater control over their insurance programs. Caitlin Morgan’s expert consultants can assist you in assessing your clients’ needs and customize a captive solution that is perfect for them. Just give us a call at 877.226.1027.
Sources: CIMA, A.M. Best, IMAC