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Enel’s Gabriele Frea expecting more Italian captives to follow

Richard Cutcher
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Enel’s Gabriele Frea expecting more Italian captives to follow

Gabriele Frea, head of insurance and risk financing at Enel Group, the owner of Italy’s first captive, believes “now the path is traced, other groups will follow”.

Enel Erre, owned by Italian multinational manufacturer and distributor of electricity and gas, Enel, received a reinsurance licence from the Italian regulator IVASS on 21 November last year. Aon and local law firm Bonelli Erede supported the project.

Enel’s Italian captive completed the merger with its existing Netherlands-domiciled captive, Enel Insurance NV, completing the re-domestication process and being assigned a financial strength rating of ‘A-‘ (Excellent) by AM Best.

“Now the path is traced other groups will follow us,” said Frea, speaking on episode #99 of the Global Captive Podcast.

“Other captives will soon be set up in Italy, stimulating a more conscious approach to the risk management and the risk financing activities, especially moments of market hardening as the one we are living through today.”

He added that risk managers from other organisations have been in contact and expressed interest in forming or re-domesticating captives to Italy.

“Due to these factors, Italian captives are expected to increase significantly in the very near future,” he said.

Last month, multinational cable specialists Prysmian Group SpA received authorisation for Italy’s second captive, which it plans to merge with its existing Dublin captive.

Captive Intelligence reported in January 2023 that several Italian-owned captives had begun discussions with IVASS on the possibility of re-domesticating captives back home.

Frea said there was a long and intensive period of analysis before a decision was made regarding Enel’s Italian captive.

“We had to calculate all the pros and cons of this solution and all the opportunities and the difficulties,” he said.

“As a matter of fact, I do not believe that everyone at the time was confident that the success would be achieved.”

Listen to the full, exclusive interview with Enel’s Gabriele Frea on GCP #99 here, or on any podcast app. Just search for ‘Global Captive Podcast’.

ReadyCell can lower barriers to entry to wider middle market – Ellen Charnley

Luke Harrison
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ReadyCell can lower barriers to entry to wider middle market – Ellen Charnley

Ellen Charnley, president of Marsh Captive Solutions, believes the launch of ReadyCell should significantly lower the barriers to entry to captives and can widen the appeal of cell strategies to a broader group of insureds.

ReadyCell was launched earlier this month to enable organisations to form their own cell within its Mangrove Protected Cell Facility, domiciled in Washington DC.

Speaking on the episode 99 of the Global Captive Podcast, Charnley said ReadyCell had been in development for several years.

“Our hypothesis is that because we’ve driven down the cost and lowered those barriers to entry, we’re now appealing to the segments of the market that doesn’t currently have captives,” she explained.

“Potentially those smaller companies or those middle-sized companies that have historically thought that a captive or a cell captive is just too far out of their reach from a budgeting standpoint.

“Now we’re saying: ‘Why wouldn’t you? We’ve driven those costs down and we’re making it available to you.’ So that’s what we anticipate.”

Charnley added that ReadyCell is not restricted in what types or sizes of companies can utilise it. She can see potential use cases for larger organisations that have a particular challenge on one line of business and need a “super fast” solution.

“Large organisations that don’t have a captive could easily form a ReadyCell; not know what they need it for, it can sit there on the shelf and then perhaps at their next renewal in a few months’ time they need a property policy or they need an excess layer filled or part of their programme filled with a simple policy,” Charnley explained.

“They can activate ReadyCell and they’re off to the races. So we could see a number of different use cases that are appropriate for clients.”

Marsh has launched ReadyCell using its Mangrove cell company in Washington DC, but Charnley said they were open to the possibility of rolling it out in other domiciles.

“There is no reason why we wouldn’t explore those possibilities for other jurisdictions,” she added.

“If we see it as a success and we see the need in other jurisdictions, absolutely.”

Listen to the full, exclusive interview with Ellen Charnley on GCP #99 here, or on any podcast app. Just search for ‘Global Captive Podcast’.

Thomas Keist to join SRS Altitude as chief commercial officer

Richard Cutcher
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Thomas Keist to join SRS Altitude as chief commercial officer

Experienced captive operator Thomas Keist will join SRS Altitude as chief commercial officer from 1 April, as the start-up managing general underwriter staffs up.

Strategic Risk Solutions announced the launch of Altitude in November, to be led by former Swiss Re executive Loredana Mazzoleni Neglén, and the confirmation of Keist follows the appointment of Paul Fitzgerald as chief operating officer.

Keist has worked for Swiss Re since 2006 and has been global captive solutions leader at Swiss Re Corporate Solutions since 2020.

He will lead SRS Altitude’s business development activities globally and drive strategic initiatives to grow the business across non-standard solutions.

“Having had the privilege of a longstanding acquaintance with Tom, I have great admiration of his extensive knowledge and expertise”, said Brady Young, CEO of SRS.

“I am delighted to welcome him to our team, confident that his presence will significantly bolster our success.”

Keist said: “I am honoured and thrilled to join the SRS family. I am confident that my skills and passion align perfectly with the company’s vision, and I am eager to be part of a team that values innovation, collaboration, and excellence.”

Captive Intelligence understands further hires are expected in the coming months, with SRS Altitude set to begin operations in the first quarter of 2024.

edRISK to launch liability and property cells

Luke Harrison
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edRISK to launch liability and property cells

edRISK, a sponsored captive, plans to launch two new cells on 1 June, edLIABILITY and edPROPERTY, for liability risk and property risk, respectively.

The organisation already operates edHEALTH, a group medical stop-loss captive for higher education and secondary schools, which recently converted to a cell structure.

“Employee benefits are an important item for these schools, and when we think about what a school does, they teach students, and that means taking care of the faculty and staff who are teaching the students,” David White, chief financial and operating officer for edRISK and edHEALTH, told Captive Intelligence.

“Payroll and benefits are a big part of the operating budget of an educational institution.”

The edHEALTH programme is today the largest part of edRISK, a sponsored captive domiciled in Vermont.

“Even 13 years ago, when we were talking about launching a captive, Vermont was certainly the best domicile, but now they’re also the biggest,” said Tracy Hassett, president and CEO of edRISK and edHEALTH.

“It was the access to the regulators, and it was the flexibility that convinced us to domicile in Vermont.”

White said that Hassett first came up with the idea of whether a cell structure would work.

“Creating a sponsored captive allows common service providers across different cells,” he said.

“When we launch edPROPERTY and edLIABILITY, we may use the same investment manager, the same auditor, captive manager, or actuary, and we think that’ll drive efficiencies for all the member-owners.”

White said the sponsored captive approach provides an opportunity to serve new colleges who are interested in property or liability.   

“Schools can decide If they want to join one, two, or three cells.”

White said edHEALTH has never had more inquiries from schools interested in joining because traditional insurance rates keep going up, “and our job at edHEALTH is to bend the cost curve”.

Hassett added that the captive has a very strong focus on trying to help those individuals who are high-cost claimants and need some help navigating the healthcare system.

“We’re also focusing on the rest of the population to make sure they have access to the care they need so they do not become high-cost claimants if we can avoid it,” she said.

Hassett said that she would never tell a school that they cannot join because of their claims.

“That said, what we want to be sure of is that a school is financially stable and has an open mind about controlling their claims,” she added.

“Oftentimes, they come to us because they are looking for some guidance, assistance, support, and some networking with other like-minded people, to help them control the claims.”

In November, White was appointed the new chief financial and operating officer for edRISK and edHEALTH.

“I was the captive manager when edHEALTH was first formed, so I’ve seen the success and I’ve seen how they have achieved it,” White told Captive Intelligence.

“I’ve always enjoyed being part of the team, so now being a bigger part of the team is exciting, especially in this new role because edRISK is growing in so many new directions.”

MAXIS partners with Maven Clinic specialising in women’s and family health

Luke Harrison
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MAXIS Global Benefits Network (MAXIS GBN) has partnered with New York-based Maven Clinic, a virtual clinic for women’s and family health.

The partnership is the latest addition to the MAXIS wellness technology marketplace.

MAXIS is the international employee benefits joint venture between MetLife and AXA, providing fronting and programme management services for employee benefits programmes around the world, including fronting for captives.

The MAXIS marketplace consists of third-party suppliers that provide global wellness options to multinationals and their employees.

MAXIS GBN clients can now offer employees access to Maven’s virtual clinic specialising in women’s and family health.

“The landscape for family-building and reproductive healthcare varies around the world, making it especially important for employers to find a trusted partner who not only understands the local nuances of each region, but can also provide high-quality, personalised care at scale,” said Leila Thabet, VP for Global Growth at Maven Clinic.

“Maven is proud to be this partner to many of the world’s top multinational employers, and to have supported women and families globally for nearly a decade.”

The services available include fertility and family building, maternity and newborn care, parenting and paediatrics, and menopause and ongoing care.

Employees can also meet with virtual practitioners across 30 types of specialties who aim to meet their needs, culture and language preferences, and time zones.

“I’m delighted we are adding Maven Clinic to our wellness technology marketplace,” said Dr Leena Johns, chief health & wellness officer at MAXIS GBN.

“As diversity, equity and inclusion continues to rise up corporate agendas, it’s vital that multinationals have access to services that can truly support all of their people, at all stages of life, wherever they are in the world. “Maven Clinic is an expert and a global leader for women’s and family health, and we’re excited to work with them to support our clients and their people.”

GCP #99: Ellen Charnley on ReadyCell, Gabriele Frea on Italy’s first captive

Richard Cutcher
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GCP #99: Ellen Charnley on ReadyCell, Gabriele Frea on Italy’s first captive
Ellen Charnley, Marsh Captive Solutions
Gabriele Frea, Enel Group

In episode 99 of the Global Captive Podcast, supported by the ⁠EY Global Captive Network⁠, Richard is joined by two guests with exciting news to share and analyse.

01.24 – 09.37: Ellen Charnley, president of ⁠Marsh Captive Solutions⁠, returns to the pod after the world’s largest captive manager l⁠aunched ReadyCell⁠ earlier this month. ReadyCell utilises Marsh’s Mangrove protected cell company facility in Washington DC and promises a super fast set up time for new cell formations.  Ellen tells us how the product was developed and how they hope it will be utilised.

09.40 – 17.57: In November, we reported on Captive Intelligence that the ⁠first Italian captive had been formed⁠. Richard interviews we Gabriele Frea, Head of Insurance and Risk Financing at Enel Group, who explains why they decided to ultimately re-domesticate from the Netherlands and the process involved.

To keep up to date with developments in the global captive insurance market, visit ⁠Captive Intelligence⁠ and sign up to our ⁠twice weekly newsletter⁠.

Connecticut licenses 10 new captives in 2023

Luke Harrison
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Connecticut has added 10 new captive insurers to its ranks in 2023, reflecting a 22% increase, while the number of cells in the state increased by 13.

At the end of 2023, Connecticut had 53 captives and 25 cells domiciled in the state.

“With recent pro-captive legislations, increased staffing, internal support, and collaborations across the state, Connecticut continues to attract global captive insurers and service providers, further establishing itself as a premier domicile and solidifying our title as the insurance capital of the world,” said Commissioner Andrew Mais. 

Connecticut’s new captives include the establishment of new insurers and the re-domestication of existing captives to the State.

Captives domiciled in the state predominantly issue policies to cover risks that are unavailable or have a high cost in the commercial market.

These risks include commercial auto liability, general liability, workers’ compensation, contractual liability, climate risk, business interruption, mechanical breakdown, employment practices liability, reputation risk, cyber, and other ESG risks.

“Under Commissioner Mais’s leadership, we will continue to employ a risk and principles-based approach to provide cost-efficient and flexible regulations, ensuring the long-term success of captive insurers.” said Fenhua Liu, assistant deputy commissioner of the Captive Insurance Division. 

AM Best assigns rating to Saudi mining captive

Luke Harrison
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AM Best has assigned a financial strength rating of B++ (Good) and a long-term issuer credit rating of “bbb+” (Good) to UAE-domiciled Ma’aden Re (MRE).

MRE is a captive reinsurer of Saudi Arabian Mining Company (Ma’aden). The outlook assigned to these Credit Ratings (ratings) is stable.

The captive currently only writes property damage and business interruption reinsurance, and its risks are concentrated in Saudi Arabia.

MRE is a newly formed captive, established in November 2021, which completed its first full year of operations in 2022 and has a limited performance track record.

The captive’s profitability in 2022 was materially impacted by two large claims, which exhausted its aggregate yearly limits and resulted in the combined ratio of 175.9% for the year.

MRE’s profitability is projected to improve materially in 2023 and to remain supportive of an adequate assessment over the cycle.

The ratings reflect MRE’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

MRE’s very strong balance sheet strength assessment is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s capital adequacy ratio (BCAR).

AM Best expects MRE’s risk-adjusted capitalisation to remain at the strongest level, supported by the captive’s moderate underwriting exposure, low asset risk profile and the good credit quality of its retrocession programme.

Partly offsetting factors in the balance sheet strength assessment are the captive’s dependence on reinsurance and its concentration of assets in Saudi Arabia.

Captive USA 2024 Part I: Property to dominate the US captive market

Luke Harrison
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Captive USA 2024 Part I: Property to dominate the US captive market
  • Increased retentions and quota shares for captive property programmes
  • High emitting companies could struggle to attain property capacity
  • Third-party risk and cyber expected to proliferate in the captive space
  • Increased interest in ERISA exemption, reliant on ExPro return

Companies seeking property coverage will continue to be the driving force behind captive formations in the United States in 2024, as companies look to negate rising costs and reduced capacity in the commercial market.

There is also expectation more companies will look to get the US Employee Retirement Income Security Act (ERISA) exemption from the Department of Labour (DoL), while captive interest in wider employee benefits programmes will continue flourishing.

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Rising Edge launches new NED Protect D&O policy

Richard Cutcher
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Rising Edge launches new NED Protect D&O policy

London-based D&O specialists Rising Edge has launched a new director’s and officer’s (D&O) product, designed exclusively for non-executive directors (NEDs).

The underwriting agency said it recognised the “unique responsibilities and challenges” faced by NEDs, with NED Protect providing “ring-fenced, standalone Side A D&O coverage and policy limits for individual NEDs”.

While Rising Edge does not provide D&O coverage to financial institutions, it confirmed to Captive Intelligence that it would cover the non-executive directors of a captive if its parent is not a financial institution but a commercial business.

Philippe Gouraud, CEO of Rising Edge, said: “Recent cases have shown that when things go wrong at board level, they can go terribly wrong for NEDs, who can find themselves in an isolated position when defending a claim, in which they are personally brought in.

“We felt NEDs deserved increased protection. Innovation is at the heart of what Rising Edge does. NED Protect responds to these specific needs.”

Captive board members, including NEDs, are often covered as part of the parent’s broader D&O policy, but it is advised independent directors annually check the terms and coverage of such policies.

The Airmic Captive Governance Guide, updated in 2023, states: “For iNEDs, it is important to ensure appropriate directors’ and officers’ (D&O) insurance has been bought, either by the captive itself or, more commonly, by the corporate group with the policy including coverage for the captive’s directors.

“A certificate of insurance should be provided confirming level of cover, level of the deductible and who covers it, and the name of the D&O insurer. This should be confirmed annually. iNEDs should always ask and ensure, where possible, that they are afforded the same level of D&O cover and protection as other board members.”

Rising Edge offers its D&O policies with AM Best A- rated underwriting capacity through UK and European regulated insurance licences.

Yoel Brightman, managing director and head of underwriting at Rising Edge added: “Modern corporate governance standards means that NEDs are facing higher expectations and increased scrutiny from their roles on corporate boards. In the end, it is their personal liability that is engaged.

“In response to these increased risks, we have developed a product specifically designed for NEDs, to give them that extra level of protection in addition to what they may get from standard D&O coverage.”

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