Among some of the other survey highlights:

Eighty-five percent of respondents listed admitted paper as one of their primary reasons for using a fronting carrier, with regulatory compliance as the next highest reason at 46 percent.
One hundred percent of respondents rated the overall level of importance of fronting to their captive as either "very important" or "important," while 78 percent listed having an A-rated fronting company as "very important."
Eighty-nine percent of respondents characterized the price of fronting as "reasonable," while 11 percent called it "expensive."
Sixty-three percent characterized the value of their fronting relationship as "excellent," with the other 37 percent listing it as "moderate." No one rated the value as "low."
Forty-eight percent of respondents reported no change in the cost of fronting from the prior year, while 30 percent reported an increase in costs of less than 10 percent and 20 percent reported a decrease.
Twenty-four percent of respondents said they considered the price of their reinsurance to be "expensive," 67 percent reported it as "reasonable," and 9 percent as "inexpensive."
Nineteen percent of respondents said their reinsurance costs are the same as the prior year, with 43 percent reporting an increase and 38 percent reporting a decrease.
A majority (53 percent) of respondents reported investment yields of 2-to-3 percent, with another 13 percent reporting investment yields in the 4-to-5 percent range. Twenty-two percent of respondents reported yields of zero-to-1 percent, but no one reported less than zero percent.

The survey was drafted and approved by a CICA committee and was conducted by the independent consulting firm of Veris Consulting, LLC, of Reston, Va.

Special Reports /

Collateral Remains Biggest Concern For Captive Owners, CICA Survey Finds

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