Which of the following statements about captive insurance companies is (are)true?
I.A captive insurance company established by a U.S.company must be domiciled in the United States.
II.A captive insurance company may be owned by several parents.
A)I only
B)II only
C)both I and II
D)neither I nor II

Question

Quizplus · Accepted Answer

II is true because a captive insurance company can indeed be owned by multiple parent companies, allowing for shared risks and costs among the owners. This is known as a group or association captive. I is false because a U.S. company can establish a captive insurance company in various jurisdictions outside the United States, not just within it, to take advantage of regulatory, tax, or cost benefits.

Which of the Following Statements About Captive Insurance Companies Is