Captive insurance organizations are insurance companies that are owned and controlled by their insureds.
A captive insurance company can be defined as a special purpose insurer whose sources of business are (1) its shareholders and their affiliates which put their own capital at risk, or (2) other participants such as association or group members.
III. CORPORATION DOCUMENTATION A. Charter B. Offering Memorandum C. Subscription Agreement D. Escrow Agreement E. By-Laws IV. MULTIPLE OWNERS RELATIONSHIPS A. Voting Rights B. Capital Contribution C. Standards for Participation In A Group Captive D. Profit Participation In A Group Captive E. Departing Shareholders/Insureds F. Settlement of Disputes I. INTRODUCTION A. Domiciles and Legal Structures B. Corporation Documentation C. Relationships Between Multiple Owners D. Insurance Regulation E. Securities Regulation F. Insurance Documentation G. Management Services H. Contracts II. DOMICILES AND STRUCTURE A. Company Domicile B. Corporate Form C. Capitalization D. Board of Directors E. Officers F. Committees G. Name of Captive Captive Formation Steps
V. INSURANCE REGULATION A. U.S. Insurance Regulation B. Captive Domicile Regulation VI. SECURITIES REGULATION A. U.S. Securities Regulation B. Captive Domicile Regulation VII. INSURANCE DOCUMENTATION A. Policy Forms B. Fronting Arrangements C. Underwriting Guidelines D. Rating of Policyholders E. Miscellaneous F. Reinsurance Placement VIII. MANAGEMENT SERVICES A. Designate Manager B. Designate Law Firm C. Designate Bank D. Designate Auditors E. Other Service Providers IX. CONTRACTS A. Management Agreement B. Reinsurance Agreement C. Trust Agreement Captive Formation Steps