This course covers the concept of “cost of risk” (COR)—how to quantify, reduce, and manage it. It demonstrates how captive insurance can lower these costs, providing an overview of captives, their types, and their functions. The course also addresses tax and accounting issues affecting captives’ effectiveness in managing financial risk.

• recognize the risk management purpose of using a captive to finance an entity’s risks, identify the elements of captive insurance, and recognize why a captive can insure many types of risks
• distinguish among various types of captive insurance companies
• understand the various ways in which the costs of financing risks through a captive can be lower than the costs of commercial insurance or self-insurance
• recognize the ways in which captive insurance and other risk financing methods can smooth the financial impact of risk
• identify factors considered in determining whether premiums paid to a captive are tax-deductible