Trends and Performance — 2011 Captive Benchmarking examines the financial performance and other trends of captives from 2007 to 2010, a time of unprecedented economic challenges. It finds that although the number of active captives has remained relatively consistent, aggregate premium levels increased substantially across all geographies and most industry sectors.

Organizations have taken action over the last few years to strengthen the financial position of their captive insurance company operations, while those forming new captives are more likely to be located in U.S. onshore domiciles. Likewise, the level of captive owners’ equity also increased despite lower investment returns, an indication that owners did not deplete capital during the economic downturn. The report focuses on activities of more than 750 captive insurance company clients of Marsh—primarily single-parent captives—based on figures as of December 2010.

The report also shows that while overall new captive formations are down in most domiciles, the 10 largest U.S. onshore captive domiciles, with the exception of Arizona and Nevada, experienced growth in 2010. Since 2007, captives’ claims reserves have generally increased, but especially in those owned by financial institutions. This appears to reflect the increase in claims arising from the global financial crisis.