Managing Corporate Risks Via Captives

Aricle by Anthony Egerton

At the Jakarta chapter of Labuan IBFC's 25th Anniversary ASEAN Roadshow, Anthony Egerton, Principal Officer at Huntington Underwriting Limited, discussed the benefits of managing corporate risk via a captive. Below is a summation of his presentation.

Introduction

Globally, a captive insurer, or captive for short, has become a mainstream risk management tool for many large organisations. In fact, more than 75% of Fortune 500 companies worldwide operate with established captives today. This translates into billions of dollars' worth of premium flowing through close to 7,000 captives worldwide.

According to Anthony Egerton, Huntington Underwriting Limited's Principal Officer, Labuan IBFC has become an attractive destination for these organisations to set up a captive because of its tax efficiency. However, he strongly advises against organisations starting a captive solely for tax reasons.