Captivevakuutusyhtiö

Captivevakuutusyhtiö is a Finnish term that translates to "captive insurance company." A captive insurance company is a wholly owned subsidiary of a non-insurance parent company, established to insure the risks of its parent and/or affiliated companies. Instead of purchasing insurance from traditional commercial insurers, the parent company creates its own insurance entity to cover its specific liabilities.

The primary motivation for establishing a captive insurance company often revolves around cost savings, improved risk management, and access to the reinsurance market. By self-insuring, companies can potentially reduce premium costs, retain underwriting profits, and gain more control over their insurance programs. Captives can also offer more tailored coverage options than might be available through the commercial market, especially for unique or hard-to-insure risks.

These companies are regulated entities, and their structure and operation are subject to specific legal and financial requirements within their domicile, which is often an offshore financial center or a specific onshore jurisdiction that permits captive formation. The parent company bears the financial responsibility for the captive's operations, including its capital, solvency, and claims. Captive insurance is a sophisticated risk financing strategy employed by larger corporations and groups with significant insurable risks.