Captive Insurance Programmes

Captive Insurance Programmes

Butterfield Management Ltd is a core company under the Butterfield Group banner established specifically to establish and manage Captive Insurance programs in the innovative and flexible jurisdiction of Ras Al Khaimah in the United Arab Emirates.

Our consultants have over 50 years of combined management experience in the Captive Insurance marketplace from a host of international jurisdictions including Bermuda, Cayman, Luxemburg, Gibraltar, Belgium]  Our skills enable a seamless management program covering all aspects of insurance and re-insurance from feasibility study through to underwriting and claims handling working in harmony with our international resource partners.

In essence any profitable corporation spending $250,000 or more per year on insurance premiums could benefit from a bespoke Captive Insurance program and the Butterfield Group will be pleased to explain why a Captive Insurance program may provide a better means of risk management than the conventional insurance market.

Captive Insurance is insurance or reinsurance provided by a company that is formed primarily to cover the assets and risks of its parent company or companies. Captive insurance is essentially an “in-house” insurance company with a limited purpose and is not available to the general public.

What is a Captive Insurance Company?

A captive insurance company is, in its purest form, a subsidiary company formed to insure or re-insure the risks of its parent and / or associated group companies. Captives are usually formed to provide alternative risk management solutions to that of the conventional insurance market. The administration of a captive is usually, though not always, outsourced to a specialized captive manager.

There are a number of reasons why captives may provide a better means of risk management than the conventional market. The main points are outlined below.

Cost control

Premiums charged by commercial insurers include amounts to cover the insurer’s profit margin and overheads. Such overheads can be significant when considering insurers with large corporate structures to maintain.


When the market is soft, the captive can take advantage of the low rates by reinsuring a relatively large proportion of its risks. The low cost of reinsurance allows the captive to build its reserve base. When the market hardens, the captive is able to retain a larger proportion of its risks, and can maintain cover for its parent even when commercial insurance is unavailable or prohibitively expensive.

Claims management

The process of making a claim from a third party insurer can be long and involve a good deal of cost for the claimant. Where the insurer is a captive, the claims handling procedures can be dictated by management, cutting down on the delays and bureaucracy that are often a necessary part of the claims handling procedures of commercial insurers.

Claims experience benefits

Captives generally retain a portion of the overall risk and reinsure the remainder. For this reason, when claims experience is better than anticipated, the excess of net premiums over claims is retained by the group. The reinsurance taken out by the captive is tailored to minimize the group’s exposure where claims experience is worse than projected.

Request Butterfield Captive Overview Guide here