Form a Captive

With more than 700 active captive insurance companies domiciled in the Cayman Islands, forming a captive is a well-trod path, with scores of highly qualified and experienced service providers to help along the way.

Captive formation

The initial phase of any successful captive is the preparation of a complete feasibility analysis, which reviews the current insurance programme and determines those programs where it is most advantageous to use a captive.

The second phase is the business plan - risk retention levels, limits of coverage, types of coverage, structure of programme (i.e fronted versus direct) and domicile selection.

Once the decision has been made to establish a captive, the process is as follows:

  • Select a Cayman insurance manager
  • Negotiate fronting and reinsurance arrangements (as necessary)
  • Prepare the CIMA license application with assistance from the insurance manager.
  • Meet with the Insurance Division of the Cayman Islands Monetary Authority to discuss the proposed captive.
  • Submit the completed application¬†

The captive can be licensed in four to six weeks.

What is the application process?

The application should include:

  1. Completed license application form
  2. Business plan which should include:
    • rationale for formation;
    • ownership and management structure, including proposed capitalisation;
    • description of proposed insurance programs, including limits and retentions supported by recent actuarial analysis
    • details of any fronting and reinsurance arrangements
    • details of claims administration;
    • description of loss reserving methodology;
    • description of investment and dividend policy
  1. Financial projections for a three-year period
  2. Acceptance letters from an insurance manager and auditor in the Cayman Islands
  3. Letter of undertaking as to minimum capital (usually from shareholder)
  4. Personal questionnaire, references, and police clearance certificates or equivalent for managers, shareholders, directors and officers.

Actual incorporation of the company is organised through the General Registry.  Incorporation normally takes five business days from the submission of documents and is usually only done after the insurance license has been approved in principle.

See the Captive Insurance in the Cayman Islands Handbook (revised september 2016), sponsored by KPMG for more information.

Cayman Captive Forum

Know How

Key Issues

Latest News
Tue-Oct-10-2017
Brisk Pace Continues in 2017 for Cayman Insurance Industry

George Town, Grand Cayman: 9 October 2017 Following an excellent year for new insurer licenses issued in 2016 (39 in total), the Cayman Islands Insurance Industry has set a brisk pace to new formations so far in 2017 with 23 new licenses issued. The 3rd qua...

Read More ++

Sign up for our newsletter

Email