To complement the captive owned by the parent company, American Safety Insurance Holdings
American Safety Insurance has formed American Safety Assurance (Vermont), a Vermont-domiciled segregated account captive facility to complement the Bermuda-based captive owned by the parent company, American Safety Insurance Holdings (ASI).
Reportedly, both the Vermont-and Bermuda-based captives are segregated cell facilities, meaning that the collateral or premium collected from an insured to secure the insurance obligation associated with a policy is held in an account that is legally separated from other insureds’ accounts. It is expected to provide protection to each insured from the losses or expenses incurred by other unrelated insureds.
Brad Isaacson, vice president of programs at ASI, said: “Since the differences between off- and on-shore captives have been greatly reduced, the establishment of a Vermont-domiciled facility gives clients another option to consider when structuring a program with ASI. Segregated cell captives provide interested parties with the benefits of a wholly-owned captive, like flexible program structures and retention of investment and underwriting profits, but free them of much of the time and financial expense associated with managing their own captive.
For example, ASA (Vermont) is holding $4,000,000 in collateral in a protected cell to reinsure a professional and general liability policy issued by American Safety Indemnity to a company that manages assisted living facilities. The protected cell assumes 100% of the liability from ASIC,” he added.