What does Capital At Risk mean? Read on to discover the definition & meaning of the term Capital At Risk - to help you better understand the language used in insurance policies.
Capital At Risk
Capital that is available to support the retention of risk by a self-insurer or underwriter of risk. Such "risk capital" may be required in a captive insurance company for payment of losses, in the event that premium collected is insufficient to pay losses and expenses. Typically, it is an amount in excess of statutory capital and can therefore be used as collateral to ceding companies. May also be referred to as surplus funds or risk-bearing capital.
We hope the you have a better understanding of the meaning of Capital At Risk.