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Captives increasingly a climate risk tool: WCF panel - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Captives increasingly a climate risk tool: WCF panel by Claire Wilkinson Michael Douglas of Aon, from left, Marco Hensel of HDI Global, Jeff Wilson of the Iowa Insurance Division and Terry Lee of the University of Colorado. Alternative Risk Transfer/Captives , Risk Management Aon Feb 5, 2026 ORLANDO, Fla. — Organizations are increasingly using captives as a strategic tool to manage climate-related risks, harness data and fund resilience initiatives, experts say. Weather-related losses are increasing in frequency and severity, said Michael Douglas, director of business development for Aon’s captive insurance group. Global economic losses from natural catastrophes totaled $260 billion in 2025, and that was considered “a good year,” Mr. Douglas said during a panel session at the World Captive Forum, sponsored by Business Insurance. Even so, many companies say the market is contracting, with higher deductibles, lower limits and stricter conditions, he said. “We have seen this movie before in the captive industry. When marketplaces are either a bit slow to react or have a certain problem, when the marketplace says ‘no.’ Your choice, do it yourself,” said Mr. Douglas, who moderated the session. The cost of risk is increasing, said Marco Hensel, chief underwriting officer at HDI Global. “Prices in the insurance industry, especially for nat cat, continue to go up. There’s a point in time where you think about, is it even available and what kind of capacity can you buy?” Mr. Hensel said. That could be a very good reason to consider a captive, he said. “It could be that you have your strategy well under control and you are willing to take the risk yourself rather than passing it on to the insurance industry,” he said. Many companies are being pushed into alternative solutions to fund property risks, said Jeff Wilson, captive insurance director at the Iowa Insurance Division. While risk managers have long been comfortable using captives for casualty risks, severe weather losses like Iowa’s devastating derecho in 2020 made them turn to captives for property risks, Mr. Wilson said. “Carriers were going bankrupt. They were pulling out of the state, there were moratoriums on new business, rate increases were 30% to 50% for three to five years in a row,” he said. As a result, companies began placing property coverage into captives, despite the volatility and concentration of risk, which is “certainly a scary scenario,” he said. Colorado is now the drought, wildfire, hail, wind and freezing state, said Terry Lee, and chief risk officer in the Office of the President and for the University of Colorado’s system administration. The university has four campuses across Colorado and is the state’s third-largest employer, with $16 billion in scheduled assets and about $7 million in annual revenues, all of which are now difficult and too costly to insure, Mr. Lee said. Using a captive helps organize the coverage, protects surplus from being reallocated, meets regulatory needs and allows better control over deductibles and internal cost allocation, he said. Captives play a critical role as a hub for collecting exposure and risk management data, panelists said. Having accurate data is essential to properly assess risks, Mr. Hensel said. “It’s not just the property values,” he said. Real estate risk extends to business interruption, interdependencies and global operations, he said. “When one location is affected by a weather event, how does that impact the global organization? Understanding all that and collecting the data, that’s the bread and butter,” Mr. Hensel said. As a newer domicile, Iowa relies on service providers, Mr. Wilson said. Captives typically use companies’ historical and actuarial loss trending data, but weather-related captives require catastrophe modeling, he said. “That’s where we rely on the actuaries to really help us understand it, as well as regulators. Actuaries are extremely important in the process of setting the rates, determining how much capital is required,” he said. The University of Colorado has been self-insured for decades and administers all of its claims in-house, Mr. Lee said. “We have more data than you can shake a stick at,” he said. Related News Adapting to AI may create exposures: Report February 5, 2026 Kansas medical cannabis bill introduced February 5, 2026 Marsh Risk names global supply-chain practice leader February 5, 2026 Analysis: Zurich’s Beazley bid sets the stage for more insurance deals February 5, 2026 Verizon calls out T-Mobile February 5, 2026 Renewal rates down in January from previous month: Ivans February 5, 2026 Renewable energy MGA expands capacity February 5, 2026 Everest rebounds back to profitability February 5, 2026 CK Hutchison takes Panama to arbitration February 5, 2026 Facebook-f X-twitter Linkedin-in Business Insurance is a singular, authoritative news and information source for executives focused upon risk management, risk transfer and risk financing. 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