The Assurex Global broker network announced this week that it was forming a new Bermuda captive to be named Assurex Global Reinsurance Ltd. The company, which claimed in a press statement to be the world's largest privately held risk management and commercial insurance brokerage, said the new venture - which will be set up as a segregated cell captive - will "provide critically needed risk management solutions to corporate customers around the world."

A captive is an insurer formed by a corporation to insure the risks of the owner or related third parties. Captives, essentially self-insurance, can provide alternative solutions to coverage available from traditional insurance markets. A segregated cell captive, also referred to as a rent-a-captive, utilises the services of an already existing captive, renting out a "cell" independent of the rest of the captive. This can be an affordable way for a company to insure its own risks without going through the expense of setting up its own captive.

Assurex Global Reinsurance Ltd. will initially reinsure a programme for a "heterogeneous" group of corporate clients underwritten by Farmington, Connecticut-based Discover Re Managers Inc., an alternative risk unit of The St. Paul Companies.

Assurex added that future programmes would be written in separate cells of the new company and include "more difficult commercial classes", including medical malpractice, assisted living, California workers compensation, small commercial and construction risks.

The captive is to be managed by HSBC Insurance Solutions (Bermuda) Ltd., an Assurex partner firm.