Bermuda was one of two domiciles to respond to Butler University captive
Butler University, the university known for setting up the world’s first student-run captive, has said that the captive will look at expanding its coverage over the next few years, and has third party coverage in the pipeline, professor Kevin Thompson told Captive International.
“We’ve talked about a strategy to develop an entrepreneurship in innovation coverage. And this would be intended for third party risk incubators. Start-up companies in incubators often have a hard time finding coverage,” explained Thompson.
Butler’s Bermuda-domiciled captive, the MJ Student-Run Insurance Company, has grown substantially over the last few years, and has around 80 students involved in the programme. It was founded in 2016, and over a period of eight months of implementation, it received its license from the Bermuda Monetary Authority (BMA) in Spring of 2017.
In order for the captive to provide this coverage for incubators, Thompson explained that it needs to become a Class 2 insurer, as defined by the BMA, which would allow up to 20 percent of the business to be written as third party risks.
In terms of a time frame, Thompson suggested this captive would be ready to provide third-party coverage in the next two to four years.
“The BMA recommended when you go from a Class 1 to 2 you need to file a new business plan for approval. They would like us to have something like five years under our belt as a Class 1 first. That’s a case of ‘walk before you run’, in my mind.”
Thompson gave an update on the operational activities and learning outcomes from the captive during a session at the CICA conference in Tucson, Arizona. He was speaking alongside Sammy Szames, a student who has been involved with the management of the captive.
Butler’s captive currently provides coverage for its police dog, along with its Real Business Experience (RBE) class, along with the fine art and floating property owned by the university, for example rare books, telescopes, and antique clocks.
The panel also praised Risk Management and Insurance (RMI) course being taught at universities, and claimed that students working on the captive programme had a 100 percent job placement rate.
Another session at the CICA conference suggested that 25 percent of baby boomers will retire in the next two years, and there would be 400,000 job opening in the insurance industry.
“We’re trying to position our students in learning to satisfy that talent crisis,” said Thompson.
CICA 2019, Butler University, student-run captive, Captive, RMI, North America