Captive CE

Captives as Risk Retention Mechanisms

Course Details

This course is not subject to discount pricing.

Additional Credit Available:

Add Insurance CE

Delivery Method: 


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Field of Study: 

Specialized Knowledge

Last Reviewed: 

January 2021

Study Level: 


Exam Requirements

Proctor Required: 


Passing Grade: 






Please note: Adding Additional Credit may change exam requirements.


This course focuses on the cost of risk (COR)—how to quantify it, reduce it, and structure a program that will reduce its financial impact on the risk takers. The objective is to demonstrate how captive insurance can be used to reduce risk financing costs. The newcomer to captive insurance will be introduced to the tax and accounting issues that impact the effectiveness of a captive in managing the financial impact of risk.

Learning Objectives

Students who successfully complete this course will be able to:

    • 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
    • recognize key differences between captives, commercial insurance, and self-insurance plans
    • 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
    • recognize why it is important for a captive to perform underwriting, claims settlement, premium invoicing, and accounting functions similar to those of a commercial insurer
    • identify factors considered in determining whether premiums paid to a captive are tax-deductible

    Designed For

    Property and casualty risk, safety, insurance, finance, and accounting professionals


    A basic understanding of risk financing principles and how the insurance industry is structured
    International Risk Management Institute, Inc. (IRMI) is the premier provider of risk and insurance continuing education and reference publications, and is considered the ultimate authority by leading insurance practitioners. Written by industry experts, IRMI courses provide the most up-to-date, practical and reliable information possible.
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