Captive Insurance

Companies today operate in an uncertain environment in which new risks can emerge with greater frequency. It takes agility to manage such exposures as they can have detrimental impact on a firm’s bottom line: For example, losses due to cyber-attacks; a cash strain resulting from a legal claim crystalizing; or supply chain disruptions caused by the Coronavirus.

However new technologies and methodologies continue to emerge that can help with modelling and managing such exposures – to the advantage of firms of all sizes.

What is a captive insurance company?

A captive insurance company is a company that is established with the primary objective of insuring or reinsuring the risks arising from the operating business of its owners. Captives are considered a part of what is often called the “alternative market,” or “alternative risk transfer (ART) market.

What are the benefits of pursuing a captive strategy?

A captive insurance company can give its owners more control over their risk transfer costs – i.e. amounts paid in premiums in the traditional commercial market. This can be very important during times when premiums increase unexpectedly or when no provider can be found for certain risks.

Owning your own insurance company gives your business the opportunity to retain favorable, i.e. profitable, risks within the captive, and transfer the less favorable risks to the traditional insurance marketplace.

In addition, a captive insurance company allows for a more tailor-made policy that covers the exact risks of your business at a much lower cost than traditional commercial insurers – e.g. without extensive exclusions in a cyber risk contract.

Other Advantages of a Captive Insurance Company
  • Access to Reinsurance: Owning an insurance license allows the captive to access the reinsurance market directly. This allows its parent to maintain the amount of risk it is comfortable with and transfer the excess exposure at much more competitive rates.
  • Control: With a captive you can tailor an insurance policy to cover the real risks threatening your business, which the retail insurance market might not be willing to cover or may not do so at a reasonable cost.
  • Inter-Company Financing: As underwriting profits accumulate within your captive it can issue a loan to your underlying business at much more favorable terms than those of a traditional business loan from the market.
Why the Bahamas as a captive domicile?

The Bahamas is a leading financial services jurisdiction with robust regulatory compliance standards and a solid legal landscape comparable to those of the major financial centres across the globe. It is one of the Caribbean’s most experienced financial centres, having being committed to business and finance since the 1930s.

The captive insurance environment of The Bahamas has evolved significantly over the past few years, resulting in several advantages as a jurisdiction of choice to captive insurance companies.

The Insurance Commission of The Bahamas (ICB) has enacted accommodating insurance legislation that facilitates a variety of captive structures, including group captives, pure captives and cell captives. The ICB has a dedicated and talented staff overseeing the establishment and ongoing regulation of numerous captive insurance companies.

Some specific examples of the benefits of The Bahamas as a captive domicile include:

  • Accessibility to regulators
  • Industry expertise – including actuaries, lawyers, auditors, insurance managers etc.
  • Scope of permitted insurance business
  • Reduced operating costs
  • No insurance premium taxes
  • Being an international gateway: The island chain is strategically located 50 miles from the United States with global connection(s); direct flights from 18 US cities, Canada, UK, Europe and Latin America

About us

Your business is our only concern

Nassau Captives was established for the sole purpose of helping customers worldwide with designing, implementing and maintaining efficient and cost-effective captive insurance solutions to meet their risk management needs.

We operate from the city of Nassau, in The Bahamas, which is one of the top and most strategically located financial centers in the Americas.

Risk and opportunity

Our practice was founded on the belief that good risk management can reduce costs as well as reveal opportunities that may have been missed without a structured risk management program. Efficiently managing risk exposures is at our core.

In association with our partners, at the actuarial consulting firm Nichol & Co, we can provide a full suite of services to help firms with finding suitable solutions to problems faced: Services we provide include exposure analysis, feasibility studies, and captive management.

Our people

We are consultants at heart, with skills honed by many years of experience solving challenging problems for our clients. We always ensure to carefully listen to clients so that the best solutions are found to meet their goals and objectives.

Our Services

Singular focus on achieving your goals

At Nassau Captives we are focused on providing the best quality services and advice to help with meeting your goals. We offer captive management services in The Bahamas domicile only, with the aim of being the best source of expert and local knowledge here.

We are licensed and regulated by the Insurance Commission of The Bahamas, with whom we maintain a close and professional relationship. We also maintain relationships with a number of strategic partners, both local and international, to make sure we have access to expertise to ensure the best value solutions can be designed for problems of any complexity.

Nassau Captives provides a variety of captive management and consulting services including the following:

Captive insurance management services

  • Resident representative services (in compliance with the 2010 External Insurance Act)
  • Forming and licencing of captives
  • Providing insurance program, risk management, and underwriting expertise
  • Insurance administration and claims handling expertise
  • Company secretarial
  • Accounting
  • Regulatory compliance
  • Corporate governance

Captive insurance consulting services

  • Captive feasibility studies
  • Risk identification, assessment and retention analysis
  • Advice on investment policy and strategy
  • Advice on capital adequacy, allocation and efficiency (including Solvency II)
  • Advice on corporate governance and internal controls
  • Documentation and risk reporting