recognised as the largest domicile of captives in the world.

According to recent European Risk Management Hall of Fame inductee Hugh Rosenbaum, an increase in the use of offshore captive insurance vehicles, especially rent-a-captives and segregated account companies, is expected now that Bermuda, the largest captive domicile, has passed its segregated account legislation.

Rosenbaum, a retired Towers Perrin consultant, made the forecast at the recent 10th Annual World Captive and Alternative Risk Financing Forum in Palm Beach Gardens, Florida, where he was commenting on basic captive applications for funding property casualty and employee benefits risks.

Segregated account companies are like rent-a-captives since both provide non-owned captive insurance services.

"The high turnout at this conference, together with the reported higher insurance rates, are indications that captive activity will be on the increase in 2001," said Rosenbaum.

"And since the large established captive-owner market seems to be stabilised in the US, the growth will be coming from newer entities and second-tier companies where representatives also are expressing an interest in finding better ways for pre-funding employee benefits.'' Island receives insurance recognition Segregated account companies have been forming offshore in Guernsey and Cayman and attracting hundreds of new captive-like accounts, according to Rosenbaum.

"Now that Guernsey and Cayman have been joined by Bermuda, where classic rent-a-captives have been operating for a long time, I think the era of the non-owned captive insurance company service has come into its own,'' Rosenbaum added.

Rosenbaum's presentation was one of a number at the World Captive and Alternative Risk Financing Forum, which also featured sessions on new risks in health care and ways to use advanced financing techniques for captives.

Sessions also were held on group captives as well as on employee benefits, pensions and captives.

The conference was co-sponsored by Business Insurance, Skandia Inernational Risk Management and Tillinghast -- Towers Perrin.

Tillinghast -- Towers Perrin provides management consulting to financial services companies. In addition, its risk management practice consults to a wide range of companies beyond the financial services industry. Its health sector practice consults to organisations that finance and manage health care risks.

Its consultants help clients improve business performance through quantitative analysis, insight and execution. The firm works with clients to develop strategies that are tailored to their needs.

Tillinghast -- Towers Perrin is part of Towers Perrin, one of the world's largest independent consulting firms, with a staff of over 8,000 in more than 20 countries.