Which of the following statements about captive insurers is not correct? A) They are typically a subsidiary of a larger firm or firms. B) They are typically located in places where insurance regulation is less restrictive. C) They capitalize on their size to mitigate risks. D) They are typically located in places where insurance regulation is less costly.

Question

Quizplus · Accepted Answer

Captive insurers do not primarily capitalize on their size to mitigate risks. Instead, they are formed by their parent companies to insure the risks of the parent company or its subsidiaries, leveraging specialized knowledge of their own risks and seeking cost efficiencies and customization in coverage.

Which of the Following Statements About Captive Insurers Is not