Cayman retains global 2nd place in captive rankings

(CNS): At the end of 2010 the Cayman Islands was home to 738 of the world’s 5,627 insurance captives, according to the industry magazine, Business Insurance. In its captive insurance report, the publication ranked Cayman second behind Bermuda, where 845 captives were domiciled at the end of 2010. Behind the Cayman Islands is the American state of Vermont, which has 572, and in fourth is Guernsey with 34, and rounding out the top five is Anguilla with 252. The magazine also stated that the world’s largest captive managers were Marsh Captive Solutions (1,263), Aon Global Insurance Managers (1,218), Willis Management (318), USA Risk Group (197), and HSBC Insurance Management (196).

This year Business Insurance also sought to identify the number of captives electing to operate under Internal Revenue Code Section 831(b), which allows captives that collect less than $1.2 million in premiums a year to elect to pay federal taxes only on their investment income. Managers reported a total of 703 831(b) captives, with the largest such managers including Artex Risk Solutions Inc. (145), Active Captive Management LLC (141), and Alta Holdings LLC (93).

Meanwhile, according to reports on Bloomberg, insurance companies are looking at billions in losses from the earthquake in Japan, with one early estimate placing the figure as high as $35 billion US. oAIR Worldwide, a Boston-based specialist in catastrophe modelling, said on Sunday that insured losses will likely come in a range between $15 billion to $35 billion. That estimate only covers damage from the initial 8.9 earthquake, however, and not the tsunami or multiple aftershocks that followed.

"Despite a probably low insurance penetration, we feel that the magnitude of this event might make it the largest insured event ever," DZ Bank analyst Thorsten Wenzel told Bloomberg.