International Center for Captive Insurance Education



Protecting the Captive: Predicting Risk, Reinsurance and Other Transfer Mechanisms


9 CPE credits are available for the successful completion of this course.

This course will begin with an overview of predicting risk for loss reserving, ratemaking, and financial forecasting. Once the basics of predicting risk have been covered, a direct writing captive may use a number of different program structures to manage its shareholders’ retained risk. Policies can be written for corporate reimbursement, aggregate excess, or primary protection. In each case, the objective is to pool the risks of operations. The financing of retained risk can also be achieved by pooling risks between different captives. In either case, the captive’s operating and claims handling procedures must support the transfer of risk from the insured operating entities to accomplish the shareholders’ financial objectives. Participants in this course will learn how to make sure the captive operates like a real insurance company.

Captives are designed to take risk, with premiums calculated to fund expected losses over time. There are a number of methods of developing expected loss projections, and there are different rating methodologies, each designed to allow an insurer to be adequately funded. The lines of insurance underwritten, the terms of the policies, the rating methodology, and the availability of capital and surplus determine how much risk can be insured. Consideration of efficient use of capital influences the actual amount of risk that a captive should retain. Participants will learn how much risk should be retained in a captive.

This course will explore how a captive uses reinsurance to protect itself from unexpected high-severity or high-frequency losses and leverages its capital to earn underwriting income without retaining risk. Participants will learn when it makes sense for a captive to buy reinsurance.

The flexibility of captive insurance allows an insured to finance risk off or on balance sheet depending on which approach delivers the most financial benefit. Participants will learn how a captive can be used to allow an insured to finance retained risk off balance sheet.

In this course, topics covered include:

To see when this course will be taught again go to the course schedule page.

Spring Course begins April 2015

Online course

Instructors: Joel Chansky & Evan Bennett and Aidan Kelly

In addition to self-paced reading and assignment work, students will be required to attend six webconference sessions, one pre-recorded lecture and complete two weeks of follow up assignments.

Registration Deadline: April 23, 2015

Webconference one, Thursday, April 30th, from 2:30 - 3:45 p.m. EDT
Webconference two, Thursday, May 7th, from 2:30 - 3:45 p.m. EDT
Webconference three, Thursday, May 14th, from 2:30 - 3:45 p.m. EDT
Reinsurance Office Hour, Thursday   May 21st, from 2:30 - 3:45 p.m. EDT

Webconference four, Thursday, May 28th, from 2:30 - 3:45 p.m. EDT
Webconference five, Thursday, June 4th, from 2:30 - 3:45 p.m. EDT
Webconference six, Thursday, June 11th, from 2:30 - 3:45 p.m. EDT

For further details please contact at ICCIE at 802-651-9050.

To see when this course will be taught again go to the course schedule page.