What is an Offshore Captive Insurance Company?
A offshore captive insurance company is a subsidiary company, wholly owned by a non-insurance company, that underwrites the insurable risks of its parent company or of its related or associated companies. An Offshore Captive Insurance Company is a form of self-insurance where a company, group of companies or professionals, sets up an insurance company to self insure the normal or expected loss and to cover the potential catastrophic loss in the commercial insurance market by means of reinsurance. Captive insurance companies have direct access to commercial insurance underwriters and enjoy substantial discounts and credits often based on the company history rather than the industry standard. Premiums for insurance cover is, in most countries, tax deductible irrespective of the nature of the insurance company. But self-insurance through the creation of – for example – savings or investment accounts within the corporate structure normally are not allowed for tax deductions until the funds
