The captive industry has seen “phenomenal growth” in the last 18 months during the pandemic, states president Dan Towle at the opening of the Captive Insurance Companies Association (CICA) Fall Forum this week.
Towle attributes this growth to the historical use of captives to implement creative solutions to fill coverage gaps of commercial profit.
“In support of this continued growth, it is important to take the time to come together to share best practices, explore the uses of captives, celebrate our success and identify new ways to engage the new talent needed to advance the industry,” he comments.
Towle also notes the “booming” captive industry is bolstered by one of the longest hardening markets the industry has ever seen in recent times, which has fostered greater interest in alternative risk financing in general.
However, it was also noted in the forum’s opening remarks that the captive industry remains misunderstood, particularly by taxing authorities at both federal and state level, which mitigates the predictability and stability usually offered by captive structures.
Furthermore, Towle observes it is difficult to convince state legislatures or Congress of the benefit of captive insurance without specific, real life examples of companies.
In response to this industry challenge, Towle says that captive insurance companies have “an incredible opportunity right now to showcase their value to their parent companies and educate a broader audience about their value”.
“We absolutely need to take advantage of this point in time to showcase how captives are properly used to assist organisations during varying economic conditions and turbulent insurance markets.”
As an optimal time, from an advocacy perspective, to promote captive insurance, CICA also continues to take a leadership role in presenting the industry as dynamic through the professional development initiatives, NEXTGen and Amplify Women.
Towle identifies that students and young professionals tend to seek work environments that embrace and foster diversity, equity and inclusion, noting that both CICA committees have been proactive in creating writing, career development and networking programmes.
In particular, the CICA college student essay contest was mentioned as an effective initiative for making young professionals aware of captives, with the majority of participants stating they would consider working in the sector in the future — which undoubtedly bodes well for the future of the captive industry.
