Bermuda's insurance industry is taking the captive concept out to US risk managers in the form of `captive classrooms'.

The Bermuda Insurance Institute, with the backing of the local insurance industry, has set up a travelling classroom that visits selected chapters of the Risk and Insurance Management Society -- RIMS -- in the US to explain captives and their uses.

Captive insurance is a concept that has been gaining momentum since the 1960s, but is still not very well known among many large and mid-size companies in the US, which is Bermuda's largest market. Many risk managers are aware of the captive concept, but are not clear on details or about its application to their business.

The institute seeks to fill an educational need by taking leading captive managers and other industry experts to the RIMS chapters. They provide not only a presentation on the concept and practicalities of captive insurance, but also an ongoing link to some of Bermuda's key people in the global insurance industry.

Presentations vary in length and deal with some of the latest developments in this aspect of risk management, including rent-a-captives and segregated accounts companies. Members of the various RIMS chapters work with the presenters to ensure that matters of specific interest are covered as well as general information on captives.

The first presentation was in October to a RIMS chapter in Pennsylvania, where John Neal of Symphony Management spoke to about 25 risk managers. Last month Rochelle Simons of AON and Jonathan Groves of Marsh made a presentation to around 150 people in the New York chapter.

Ms Simons said: "It was an audience of risk managers from New York and people from the New York College of Insurance. We shared the platform with Derek White who is the assistant director of captive insurance for the state of Vermont which made the theory more appealing to the audience. It did not appear as a Bermuda sales pitch.

"It was a mixed audience and some of the questions from the floor indicated that some of the participants were not familiar with captives, although the majority were. We talked through the question of domicile with regard to forming the captive and the regulatory considerations associated with that. We also looked at the types of captives, their cost and the types of cover they are involved in.'' She said the audience was interested in the latest developments and topics such as employee benefits and third party business. They also looked at why some clients have more than one captive.

"As companies become more global in their thinking and activities and more aware of the regulations of the domiciles in which their business is located, they see the benefits of restructuring their captive programme.

"For example there may be some risks that a Bermuda captive cannot write, such as unexportable environmental risks, so a US multinational working in Europe may choose to have a second captive in Dublin or Luxembourg to cover this. A multinational may look at a Dublin or Luxembourg captive to cover risks associated with European operations and a Bermuda or Vermont captive for US operations.

"Now the EU is looking to consolidate its regulations and in so doing countries outside of Europe may find they are not able to write certain lines of business as easily as they had before,'' said Ms. Simon.

Mr. Groves also felt the `classroom' was a success. " It helped raise the profile of Bermuda as a captive centre among risk managers of New York,'' he said. "It really created interest and I feel sure the subject of captives will appear at a lot more board meetings. It raised the education level, but of course it is difficult to assess whether it will produce more companies.'' He will also be joint presenter at the next `classroom' to be held later this month in Boston. " There we will focus on why people should select Bermuda.

We will also touch on e-commerce, segregated cells and areas related to Bermuda's reinsurance market.'' There is a huge number of RIMS chapters across the US and the BII is looking to develop and expand this programme both for captives and other lines of business offered by Bermuda such as integrated products and access liability.