Fronting is a key program for captives and insurance companies. HSBC is able to provide this through an industry experienced team and flexible service with capabilities in developed and emerging markets. We offer letters of credit as well as insurance trusts and have the capability to provide custody on assets under funds withheld programs
Insurance Letters of Credit
Benefits:
- Single Contact to Manage Your Captive’s Global Requirements
- Over 30 years of Industry Expertise
- NAIC, APRA, European & Canadian Approved Wording, Evergreen Auto Renewal
- Flexibility to customize for Statutory Requirements with Regulators
We take a collaborative approach to collateral and partner with our Global Payments Solutions and Global Asset Management Product Partners in seeking to provide an array of solutions to meet the needs of your captive.
Eligible Collateral
- Fixed Deposits
- HSBC Corporate Money Fund
- Short Term Duration Fixed Income Fund
- US Treasury Fund
- Securities held in Custody with HSBC (with applicable advance rates applied upon review)
Flexibility
- Our global presence and local market knowledge, we can support cross-border solutions.
- Multi-currency capability for the issuance of letters of credit
- Our offering complies with the standards of the National Association of Insurance Commissions and other regulatory bodies
Contact: Renée Lewis, Head of Global Trade Solutions at Renee.m.lewis@hsbc.bm
Insurance Trusts
The insurance trust is an alternative to Letters of Credit for captive companies and other types of organizations that are required to post collateral.
In simple terms, the insurance trust is a trust account established to hold collateral posted for insurance or reinsurance requirements.
It offers users the following benefits:
- Comfort for the beneficiary that the insurer will fulfil its obligations
- Security over counterparty risk, with separation of legal asset ownership
- Depositor retains trust assets on balance sheet
- Depositor retains the trust income
- No need for periodic renewals
- Competitive Pricing
Contact: Helen Cart, Head of Business Development at Helen.l.cart@hsbc.bm
Why HSBC?
As a leading provider of financial solutions to the global insurance markets, HSBC provides captive and insurance banking expertise, strong balance sheet and S&P rating, industry product specialists and a global network to you.
These strong components are available to your fronting program for the ability to choose the insurance solution to meet your needs.