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Airmic releases new Risk and Captives EXPLAINED Guides

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  • Topics:
    • Captives
    • Risk Management
    • Topical Trends

New guides released to help risk and insurance professionals and their business peers understand two important topics: risk and captives...

Airmic has today released the two new guides in the relaunched series of their popular EXPLAINED guides – Risk and Managing Risk and Captives and Understanding Captives.

The first publication focuses on risk and managing risk and provides a one stop source of knowledge and guidance for risk professionals and others with an interest in managing risk.   

The second publication will support insurance and risk professionals and others with an interest in the subject in their understanding of captives and their value as part of a portfolio of risk financing solutions.

The Airmic series of EXPLAINED guides provides guidance on a range of risk and insurance subjects at an introductory level.


Risk management focus

Risk and Managing Risk EXPLAINED is aimed at those new to risk management as a risk professional or as part of other management responsibilities.

The guide summarises current approaches to risk management and explains how organisations can help to address the effects of uncertainty. It also summarises key principles of risk management and includes practical examples where appropriate. It helps the reader to understand how risks are identified and assessed in the internal and external context of their organisation.

Commenting on the release of Risk and Managing Risk EXPLAINED, Julia Graham, Deputy CEO and Technical Director of Airmic, explained:

“This EXPLAINED Guide is intended for professionals starting out on their risk management career journey or for those who have risk management responsibilities, including those in internal audit, company secretarial, finance, security, technology, business continuity, or human resources. As we continue to collaborate more closely with our professional peers it is important that we talk the same language and develop a shared and common understanding of the risk management basics”

Captives in demand

Captives are a risk financing mechanism, in the form of an insurance or reinsurance vehicle, which is typically owned by a business and assists in the management of risk.

The harsh insurance market of 2019 and 2020 has brought the topic of captives to the forefront, as insurance buyers face in some cases exponential rises in pricing, as well as new exclusions, higher deductibles and lower limits, causing them to reconsider their risk transfer options.

While the use of captives continues to evolve, the fundamentals of good practice remain much the same. Captive insurance has become an increasingly prominent risk control mechanism in the strategic planning of many organisations.

Airmic’s Captives and Understanding Captives EXPLAINED will take risk financing professionals through the life cycle of captives, from initial concept through to their benefits and uses, and finally to exit strategies.

It details case studies, acknowledging the effective use of captives and the regulatory framework and governance behind them. The Guide also considers emerging trends and explains why there is a strategic case for captives in light of emerging risks including those associated with cyber and the recent COVID-19 pandemic.

Commenting on the release of Captives and Understanding Captives EXPLAINED, Richard Cutcher, Captive Ambassador at Airmic, said:

"While captives are valuable risk management and risk financing tools throughout market cycles, there is no doubt that rising rates and decreasing capacity have pushed captives to the top of the agenda once again. Existing captive owners are taking on higher retentions and writing new lines, while new organisations are considering forming a captive or cell for the first time.

"For those new to the risk management profession, or for those new to insurance procurement, this EXPLAINED Guide provides all you need to know for a comprehensive introduction on why captives exist, how they are used and what is required to establish and operate one."