Excerpt: As Sandra Duncan, vice president of operations at Captive Resources (CRI) explained, “The types and uses of captives are now much more diverse and their growth and development has logically trended with new and emerging risks and the increasing sophistication and infl uence of the risk management function in general.”
Captives are also being considered more readily by CFOs and risk managers looking to add emerging risks to their programs, said Duncan. “Captives have developed from a somewhat reactionary, hard market alternative, to a proactive and strategic risk management tool that has moved beyond the cost reduction mindset, to recognize multiple benefits.”
This has led to captives being deployed in new lines of business, in new forms, in new geographies, and being applied to new uses. As Les Boughner, executive vice president and managing director at Willis Global Captive and Consulting Practice explained, captives and their parents are often the drivers of this innovation, recognizing a need and putting their captive to work fulfilling that requirement. “We often field questions from clients asking ‘is there any reason we can’t use the captive for this?’—I am constantly impressed by the ingenuity of our clients.”
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