Cyber risk is the number one emerging or non-traditional risk that captives are grappling with, according to the latest market study by Captive Insurance Companies Association (CICA).
Results of the study, CICA 2016 Captive Market Study, were released at the 2016 CICA International Conference, Think Big! Expand Your Captive’s Horizons.
After a year’s hiatus, the CICA Captive Market Study returned with a new format and a broader cross section of industries and domiciles participating in the survey.
Medical Stop Loss was the second emerging or non-traditional risk, followed by an “other” category associated with issues arising from the sharing economy (Uber, Airbnb, etc) just beginning to be viewed as risk management concerns.
Survey participants cited the top challenges to doing more with their captive were: resources - 30.1 percent; lack of management support - 21.5 percent, ongoing use of capital - 12.0 percent, upfront costs of new programmes - 11.4 percent and lack of knowledge about other ways to use theircaptive – 10.8 percent.
CICA said that overcoming these top challenges requires a twofold approach of effective communication, and enhanced partnerships/alignments by and among all stakeholders regarding the vision, goals, objectives and expectations throughout the life cycle of the captive.
The 2016 survey marks the 15th CICA Captive Market Study. Earlier studies were focused first on fronting, and then expanded to cover more captiveindustry issues. The 2016 survey marks another evolutionary change with the focus on gathering more actionable information.
“We asked survey participants how CICA can help address the challenges they identified and help their captives add value,” said Joel Chansky, Milliman, CICA board member and Captive Market Study committee chair.
Dennis Harwick, CICA president, added: “CICA is reviewing and incorporating the survey feedback into its plans for the coming year.”
Captive Insurance Companies Association, CICA, Captive insurance, Cyber risk, Joel Chansky, Dennis Harwick, North America