General Contractors Insurance, Ltd. (GCI) is licensed and managed in the Cayman Islands to reinsure risks from the issuing insurance company, which is licensed and provides coverage in the United States. The types of coverage reinsured by GCI are Workers’ Compensation, Automobile, and General Liability.

Each shareholder is entitled to appoint a director to GCI, and every shareholder, regardless of premium size, has one vote. A simple majority by the Board of Directors governs. The Company generally follows a four-year accounting cycle. Each policy year's results stand alone and the Board of Directors will endeavor to declare an interim distribution for an underwriting year four years after the underwriting year has ended, or as determined by the Board of Directors.

Reinsurance is in place to help protect the captive from both specific excess and aggregate losses above designated levels. The participating members own the captive.

Each captive member provides a $36,000 initial contribution to capitalization when they join the program. Some additional specifics include:

  • GCI reinsures the policy issuing company up to the captive’s specific retention of $350,000 for every loss, subject to an annual aggregate stop loss.
  • The captive is structured as a member-owned group captive such that each member is responsible for a significant portion of its own loss activity.
  • Each member’s loss funds are divided into an “A” fund and “B” fund. The “A” fund pays for losses from $0 to $100,000 and the “B” fund pays for losses from $100,001 to $350,000.
  • Each member has a potential additional premium obligation, based on losses. Therefore, each member must provide a letter of credit or cash security as collateral for that obligation. This collateral provides member-to-member security and also supports the letter of credit issued to the policy-issuing carrier.
  • Purchasing both specific and aggregate excess insurance helps protect the captive and its members. Specific excess reinsurance protects a captive against a single catastrophic loss. The aggregate excess protects a captive against a high number of frequency losses that fall within the captive’s retained limit. Combining these coverages provides captive members an expected maximum at a predetermined level for each policy year.