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Risk Partners appoints Julia Schroeck and Cassie Bachman to captive team

Luke Harrison
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Risk Partners appoints Julia Schroeck and Cassie Bachman to captive team

New Jersey-based Risk Partners has added to its ranks with the appointments of Julia Schroeck as manager of captive business development, and Cassie Bachman as manager of captive operations.

Risk Partners is an insurance specialty firm and is part of Holman Enterprises, a 100-year-old family business with an automotive focus.

“We are delighted to welcome Cassie and Julia to our team and to introduce them to our clients and prospects as we build a team of dedicated professionals to meet the evolving needs of the alternative risk market,” said Gary Osborne, VP of Risk Partners.

North Carolina-based Schroeck was previously with Hylant Global Captive Solutions before taking up her new role at Risk Partners.

Schroeck also previously worked for Strategic Risk Solutions from November 2016 to June 2022 in South Carolina, where she managed single parent captives, cell captives, group captives and risk retention groups (RRGs).

Bachman also has previous experience in the captive industry with Elevate Captives and has acted as chairperson of Self-Insurance Institute of America (SIIA)’s Future Leaders Committee.

Captive Insurance in Labuan IBFC – In a Class by Itself

Labuan IBFC
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Captive Insurance in Labuan IBFC – In a Class by Itself

A risk management solution that offers infinite growth over time

Located off the Bornean coast in Malaysia, Labuan International Business and Financial Centre (Labuan IBFC) has emerged as a significant player in the global captive insurance industry.

Over the past three decades, Labuan IBFC developed a robust framework to attract captive insurance entities, contributing to its growth as Asia’s premier international financial hub for risk management solutions. Labuan IBFC remains an attractive financial intermediation hub with more than 800 licensed financial institutions operating currently.

Early beginnings and establishment of regulatory frameworks

Captive insurance was first introduced in Labuan IBFC in the early 1990s. Recognising the potential of captive insurance as a tool for risk management, the regulator, Labuan Financial Services Authority (Labuan FSA) introduced incentives to attract global businesses. The early days saw the establishment of a few captive insurance businesses, primarily from Asia, seeking a favourable regulatory environment and cost-effective solutions.

This was followed by introduction of Labuan IBFC’s regulatory framework which has been a cornerstone of its success in attracting captive insurance entities.

Likewise, the introduction of the Labuan Financial Services and Securities Act (LFSSA) in 2010 marked a significant milestone, providing a comprehensive legal framework for captive insurance activities including the introduction of the protected cell company structure.

This act lays down clear guidelines for the establishment, operation, and supervision of captive insurance businesses.

Collaboration between jurisdiction and key stakeholders

The jurisdiction’s central location in Southeast Asia, and its proximity to major markets such as China and Japan, designates Labuan IBFC as the ideal hub for regional and multinational businesses seeking efficient risk management solutions.

The jurisdiction’s flexible, business-friendly regulatory framework meets international standards and best practices, such as those set by the International Association of Insurance Supervisors (IAIS).

This streamlined reporting, coupled with features such as a risk-based regulatory approach low capital requirements and attractive and competitive tax incentives has led to a steady increase in the number of captive insurance businesses in Labuan.

This also grants convenient business flexibility and secures confidence for business owners to establish Labuan captive setups.

Furthermore, collaborating with industry associations such as the Labuan International Insurance Association (LIIA), the largest industry grouping comprising more than 200 insurance companies, as well as insurance and underwriting managers service providers and Labuan Trust Companies (LTCs) helps captive insurance businesses navigate the regulatory landscape and creates a supportive ecosystem.

These partnerships facilitate knowledge sharing, professional development, and the adoption of best practices.

Headline numbers and accolades

Labuan IBFC offers various types of captives, including pure captives, group/association captives, multiple captives, master rent-a-captives, and protected cell companies (PCCs) catering to diverse business needs.

The Labuan captive segment has been riding on an outstanding growth track by capturing Asia’s growing demand for a cost-efficient, alternative risk management solution. This is evident from the 9.4% growth in captive premiums since 2019.

As the region’s fastest-growing captive hub, as of 2023, it is home to 69 captives, and the segment has recorded a total premium volume of USD626.6 million, comprising more than 30% of the overall Labuan insurance industry’s premiums.

For a jurisdiction that began its self-insurance journey leveraging on self-insuring the risk of Malaysian-based corporates, the fact that most captive premiums now originate from overseas markets underscores how Labuan IBFC has become the hub of choice for captives. Accolades garnered by Labuan IBFC as a testament to this include:

•          the Highly Commended International Domicile award at the European Captive Review Awards 2022 and 2023,

•          the Best Asian Domicile award at the Asia Captive Review Awards 2021, and

•          the Top International Captive Domicile award at the European Captive Review Awards 2021.

Staying ahead of the curve

A significant milestone in terms of innovation for the Labuan captive industry is Labuan FSA’s issuance of the revised Guidelines on Captive Insurance Business, which was effective 1 January 2024.

The revised guidelines included provisions for the expansion of insurable risks of Labuan captives to include indirect insurable interest risks. Significantly, there was also the introduction of a new rental captive structure – External Rent-A-Captive.

The revision also included new structures for rental captives and streamlined procedures for the establishment of new cells under PCCs.

ACC 2024 – The captive event of the year

Labuan IBFC’s highly anticipated flagship event, the Asian Captive Conference (ACC) will be returning for its seventh year on 19th September 2024, at Sime Darby Convention Centre.

The ACC 2024 is expected to deliver an even more insightful conference taking into account the evolving needs of the APAC region’s captive segment with this year’s curated theme Asian Anchors: Leading the way in captive innovation.

The theme addresses the evolving needs of the captive insurance industry in the APAC region by promoting technological advancement, regulatory adaptation, risk diversification, market growth, sustainability, and customer-centric approaches.

By focusing on these areas, the conference aims to equip industry professionals with the knowledge and tools necessary to navigate the dynamic landscape and drive growth and innovation in the region.

The way ahead

Labuan IBFC has continued to innovate and adapt to the evolving needs of the captive insurance market. The introduction of digital insurance and insurtech solutions have opened new avenues for captive insurance businesses, enabling them to leverage technology for enhanced efficiency and customer experience.

Additionally, Labuan IBFC as an international business and financial centre has strengthened its focus on Environmental, Social, and Governance (ESG) principles. This focused has also spilled over into the jurisdiction’s captive segment, whereby key players are increasingly adopting ESG practices, thus aligning their operations with global sustainability goals.

Joe McDonald joins Captives.Insure

Richard Cutcher
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Joe McDonald joins Captives.Insure

Joe McDonald has departed South Carolina Department of Insurance (SCDOI) and joined consulting and underwriting firm Captives.Insure.

McDonald will be executive vice president, director of captive consulting and a shareholder of the firm. He was previously director of captives at the SCDOI.

“We are thrilled to welcome Joe McDonald to our team,” said Nate Reznicek, president of Captives.Insure.

“Joe’s reputation, expertise and deep understanding of the captive insurance landscape will be invaluable as we continue to expand our services and support our clients in navigating the complexities of captive insurance.”

McDonald will oversee the company’s consulting platform and advise on strategic initiatives to enhance Captives.Insure offerings.

“I am thoroughly excited to join Captives Insure and contribute to its mission of delivering unparalleled value to our clients,” said McDonald.

“I will effectively leverage my experience to help the company and support the impressive growth trajectory that Captives Insure is on.

“Working with such a dedicated team and trusted partners, I look forward to making a meaningful impact and accomplishing some really great things.”

Metals and mining companies assess captive utilisation as climate risk grows

Luke Harrison
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Metals and mining companies assess captive utilisation as climate risk grows
  • Greater risk financing maturity needed to combat climate risk and green transition exposures
  • Property, machinery risk frequently written in captives
  • Mining and metals captives have unique challenges when faced with significant claims

A growing number of companies in the mining, metals, oil and gas sectors are looking towards captive utilisation, particularly in the metals and mining middle market segment, with traditional carriers reducing capacity and increasing exclusions concerning climate risk.

These companies are also assessing captives to avoid increasing rates in the commercial market, especially for property risk.

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Heilo expands Texas presence with Grace Topete hire

Luke Harrison
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National captive manager and consultant, Helio, has further added to its team and expanded its presence in Texas with appointment of Grace Topete to its team.

She joins Helio with particular expertise in the nonprofit and education industries and was recently the director of leadership programs, spearheading the launch of the Nonprofit Impact Institute at Social Venture Partners Dallas.

“The expansion of our presence in the Dallas-Fort Worth Metroplex is a natural progression in Helio’s growth and a response to client needs and our prospect pipeline,” said Helio’s managing partner, Heather McClure.

“Grace’s addition is an important next step to increase our industry and geographic reach.”

She will primarily be responsible for providing captive management and advisory services to Helio’s clients, with a focus on the Texas market.

Helio’s chief operating officer, Jesse Olsen, said bringing Topete on board will help Helio provide “world-class” consulting and services to new clients who can benefit from captive solutions.

“Nonprofits in particular suffer from chronic underinsurance,” he said. “Her network in and knowledge of that space will add meaningful value with far-reaching positive ripple effects.”

At the start of last month, Helio hired Victor Gallardo, formerly with the Oklahoma Insurance Department.

Platform’s Walker to create “one-stop shop” captive offering

Luke Harrison
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Braedy Walker, practice leader for Platform’s new Captive and Alternative Risk Financing Practice Group, is planning to integrate the firm’s new captive offering with its current brokerage services, creating a comprehensive one-stop shop for all Platform clients.

The Canadian broker was founded in 2014 and provides insurance and bonding solutions to the development and construction community. In July, it launched its captive and ART practice.

Before undertaking his new role at Platform, Walker was previously vice president, national captive practice leader at HUB International.

“It my intention to establish a captive management shop from the outset, in addition to offering captive advisory services, a cornerstone of my work at previous shops,” Walker told Captive Intelligence.

“This is something I was unable to achieve previously in my career and the ability to accomplish this was a major factor in my decision to move over to Platform.”

The cornerstone of Platform’s offering is centred around construction, real estate, and infrastructure.

“What I like about the firm is that they’re not just shooting from the hip and trying to grow into other industries hastily,” he added.

“They want to ensure they have the best people before expanding into new areas.

“They are true masters of their domain in construction, infrastructure, and real estate, with some of the best people in the industry, a couple of whom I’ve worked with in the past.”

Walker said there have been a number of potential Platform clients and prospects who have previously expressed a desire for a captive offering from the company.

“Previously, we might have been unable to offer it to current clients, which is always tricky and may have hindered the firm’s ability to attract future prospects,” he said.

“By including this solution, Platform becomes a full-service firm for companies across Canada, no matter their size.”

Walker highlighted that his job will be to set up, grow and lead the captive team for Platform, where he will effectively build it from the ground up.

He will also be tasked with making sure all the necessary structures are in place in Barbados, Alberta, Bermuda, and Cayman, and eventually in the United States.

“I’m looking forward to building the team and processes from scratch as opposed to working with inherited structures,” he said.

“We’ll be working with the rest of the team at Platform to continue growing the company, both in existing and new verticals, ensuring that clients are well served and have the solutions they need.”

Platform is currently operating only in Canada, but many of the firm’s clients have US operations.

“Given that we are a fast-growing firm, expanding into the US seems like a logical move in the future,” he added.

Brokerslink assigns Castelli new leader of risk management practice

Luke Harrison
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Brokerslink has appointed Maurizio Castelli as the new leader of its risk management practice.

The broker launched its Risk Management Practice in July 2022, with the aim of bringing together the risk management skills, knowledge and expertise from across its global network.

Castelli replaces Jorge Luzzi in the role, CEO of Risk Consulting Group, and a former president of FERMA, who passed away suddenly earlier this year. 

Brokerslink’s Risk Management Practice includes Augustas Risk Services, B.Riley Advisory Services and RCG.

Together they provide a range of services around risk assessment, risk inspection, enterprise risk management (ERM), risk analysis, loss control, captive management and business continuity.

Castelli is the CEO of Milan-based risk management consultant Augustas Risk Services SpA, and the former director of group risk management at Pirelli, and CEO of the Group’s captive.

He is also a former general secretary and president of FERMA, and a past president and chairman of the Worldwide Federation of Risk Management Associations (IFRIMA).

“We are still mourning the sudden and premature death of our dear friend and colleague, Jorge Luzzi,” Castelli said.

“Among his many roles and achievements, he was instrumental in the foundation, development, and leadership of Brokerslink’s Risk Management Practice.

“It is humbling to take on this role from Jorge and continue to deliver this important service to Brokerslink Partners and Affiliates.”

AM Best assigns rating to Micron Technology captive

Luke Harrison
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AM Best has assigned a financial strength rating of A (excellent) and a long-term Issuer credit rating of “a” (excellent) to Hawaii-domiciled S-Squared Insurance Company. The outlook for the ratings is stable.

S-Squared is a single parent captive owned by Micron Technology, an American producer of computer memory and computer data storage.

The captive, which was formed in 2021, has property exposures that are concentrated in the Asia-Pacific region in addition to workers’ compensation coverage provided for Micron’s US facilities.

Micron has had minimal workers’ compensation losses historically and brought this business into the captive for efficiency.

The firm also believes S-Squared’s participation in the property tower can provide a portion of the coverage as efficiently as the traditional property market.

The captive’s operating performance reflects actuarially needed premium for its coverage offerings of US workers’ compensation and participation in the property tower covering production facilities in Japan and Taiwan.

The ratings reflect S-Squared’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 (ERM).

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

The captive’s risk-adjusted capitalisation is expected to remain at the strongest level, supported by increased retention of earnings.

The captive is an investment in ourselves – SMUD’s Anna Marie Will

Richard Cutcher
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The captive is an investment in ourselves – SMUD’s Anna Marie Will

Increasing wildfire insurance challenges and a hardening property market prompted the Sacramento Municipal Utility District (SMUD) to consider a more ambitious cell captive programme, and utilised Marsh’s ReadyCell platform to get up and running in time for renewal.

Speaking on the Global Captive Podcast Anna Marie Will, insurance program manager for SMUD, and Allan Smith, client service leader at Marsh Marsh Captive Solutions, discussed the challenges faced by the public entity in the commercial market and explained why a new cell captive turned out to be an effective solutions.

SMUD, serving Sacramento, California, is an electric generator utilising various sources of generation including hydro, solar, thermal and wind serving a population of around 1.5 million people.

The organisation had previously utilised a cell in South Carolina purely to access the reinsurance market, but when wildfire premium multiplied 10 times in five years, and with a hardening property market with increasing retentions also biting, a new captive strategy needed to be considered.

“The cell that we were using was very helpful just to access the reinsurance coverage,” Will said.

“But we found what we needed was more consultative assistance in terms of how we could more strategically use that cell; other things that we might do besides the coverages that we were unable to purchase, and Marsh offered that for us.”

SMUD worked with Marsh to form a cell within the captive manager’s Mangrove Protected Cell Facility in Washington DC and because of a pressing time requirement, utilised its ReadyCell platform to get up and running quickly.

“SMUD was coming up to a wildfire risk challenge … and our broker at Guy Carpenter needed to get the underwriting submission out into the reinsurance marketplace quickly,” Smith explained.

“As part of that, we need to demonstrate that there was an ongoing captive that they were going to be utilizing that was licensed.

“The ReadyCell allowed us to do that very, very quickly. We were able to turn this around in hours.”

Will said the primary motivation for building a more ambitious captive programme was “budgetary”.

“We’re a public agency, so if costs increase those get passed through to our customers,” she added.

“We really are focused on how do we keep our rates stable and our increases below inflation and so one of the things we’ve been looking at, as I mentioned, was alternative financing structures.

“The captive was really appealing in that it allowed us to self-fund some of these exposures as well as invest the money and earn interest on it.

“To us it was like investing in ourselves and that was a key motivator for our team. Additionally, the idea was there were other things that we could do with this captive besides just supplement our existing coverages.”

Listen to the full Global Captive Podcast interview with SMUD’s Anna Marie Will and Allan Smith, of Marsh Captive Solutions, here, or on any podcast platform. Just search for ‘Global Captive Podcast’.

GCP Short: The SMUD insurance challenge and solution

Richard Cutcher
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GCP Short: The SMUD insurance challenge and solution
Allan Smith, Marsh
Anna Marie Will, SMUD

In this GCP Short, produced in partnership with ⁠Marsh Captive Solutions⁠, we hear about the formation of a new cell captive programme for the Sacramento Municipal Utility District, known as SMUD, from Sacramento, California.

Richard is joined by Anna Marie Will, insurance program manager for SMUD, and Allan Smith, client service leader at Marsh Captive Solutions.

Anna Marie explains the insurance challenge SMUD faced, and why and how they opted for a cell captive solution.

Allan outlines the process that was gone through and why ⁠Marsh’s Mangrove ReadyCell⁠ facility in Washington DC was an effective solutions for SMUD.

For the latest news, analysis and thought leadership from the global captive market, visit ⁠Captive Intelligence⁠ and sign up to our ⁠twice weekly newsletter⁠.

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