Turks and Caicos is the world’s leading domicile for a specific reinsurance programme the Niche Hybrid Reinsurance Company (previously known as the Producer Owned Reinsurance Company or PORC).
A niche hybrid reinsurance company is similar to a Captive, but the insurance operations associated with its business are mainly controlled by the Direct Writing Company from which it receives business.
The niche hybrid reinsurance company is effectively a captive reinsurance company, registered in the Turks & Caicos Islands and regulated by the Insurance legislation, owned by an entity engaged in supplying or producing insurance business through a strong well-regulated primary writer.
The primary writer then reinsures a portion of that insurance business with the captive, enabling the producers to participate in the underwriting profit.
Usually takes the form of an agreement between the primary writer and the captive, whereby assets of the captive are maintained by the primary writer equal to the amount of the reserve liability.
Premiums are paid into a Custodial Trust Account under the control of the Direct Writer and maintained in that account at an amount which covers the required reserves for liabilities regarding unearned premiums and claims with a small margin for fluctuations.