American Safety Insurance Forms Vermont-Based Captive

American Safety Insurance announced the formation of American Safety Assurance (Vermont), Inc., a Vermont- domiciled segregated account captive facility to complement the Bermuda-based captive owned by the parent company, American Safety Insurance Holdings, Ltd (NYSE:ASI).

Both the Vermont- and Bermuda-based captives are segregated cell facilities, meaning that the collateral or premium collected from an insured to secure the insurance obligation associated with a policy is held in an account that is legally separated from other insureds’ accounts. This provides protection to each insured from the losses or expenses incurred by other unrelated insureds.

"Since the differences between off- and on-shore captives have been greatly reduced, the establishment of a Vermont-domiciled facility gives clients another option to consider when structuring a program with ASI,” said Brad Isaacson, Vice President of Programs at ASI. "Segregated cell captives provide interested parties with the benefits of a wholly-owned captive, like flexible program structures and retention of investment and underwriting profits, but free them of much of the time and financial expense associated with managing their own captive.”

"ASI has seen recent success using the captive in conjunction with other ASI member companies, which are rated "A” by A.M. Best, in a fronting arrangement,” said Isaacson, "For example, ASA (Vermont) is holding $4,000,000 in collateral in a protected cell to reinsure a professional and general liability policy issued by American Safety Indemnity Co. to a company that manages assisted living facilities. The protected cell assumes 100% of the liability from ASIC.”

Other examples of uses of the captive include serving as a stepping stone to the development of a new wholly-owned captive; using as a vehicle to run-off or close down an existing captive; and using to access reinsurance markets for surplus relief or expansion of an existing program.

American Safety Insurance has more than a decade of experience structuring rent-a-captive programs and provides flexible options with regards to collateral and fees. Clients of ASI’s alternative risk programs, fully funded and fronting products enjoy the ability to select individual or group programs with or without bundled claims and accounting services.

For additional information on American Safety Insurance and its alternative risk transfer programs and capabilities, please contact ASI at 800-388-3647 or visit www.amsafety.com.

ABOUT ASI

American Safety Insurance Services, Inc. (ASI) offers innovative insurance solutions in the alternative insurance market for environmental remediation, contracting and other specialty risks underwritten by American Safety Casualty Insurance Company, American Safety Indemnity Company and American Safety Risk Retention Group, Inc., which, as a group, are rated "A" (Excellent) VIII by A.M. Best. ASI is a subsidiary of American Safety Insurance Holdings, Ltd., (NYSE:ASI), a Bermuda-based holding company.