Interview: Ian-Edward Stafrace, Atlas Insurance PCC


Intelligent Insurer speaks to Ian-Edward Stafrace, risk analyst at Atlas Insurance Insurance PCC, about the benefits of using protected cell companies.


protected cell companies offer and how will that change under Solvency II?


Q What kind of advantages do A PCC structures offer an alternative to the set up of standalone insurers, rein-


surers or captives and can result in significant cost/capital savings, especially once Solvency II is implemented. A promoter may write insurance through a


cell using non-cellular core capital of the PCC to satisfy minimum EU capital requirements. Under Solvency II, unlike standalone busi-


nesses which require a minimum of €2.3m capi- tal, no absolute minimums apply to cells since this is handled by the PCC’s core. A promoter with €1m annual premium could capitalise a cell with €200k depending on cell-specific risks, reinsur- ance and other factors. PCCs with active cores, such as Atlas, can lend diversification benefits


to cells by allowing secondary recourse to their cores, further lowering capital requirements. Cells also benefit from lower shared costs of


Solvency II governance and reporting require- ments.


Q What kind of business should company?


consider using a protected cell A Organisations have established cells as fronting facilities, captive risk financing


vehicles or to sell insurance to third parties. At- las was the first PCC to host an insured-owned cell writing own motor fleet insurance directly in the UK, with no fronting costs, accessing lower cost reinsurance market.


Q Why is Malta a good place to be based?


Ian-Edward Stafrace, Atlas Insurance PCC A Malta is the only EU member state that


offers PCC legislation and this enables


the direct writing of risks across the EEA through passporting. Malta maintains a strong and stable eco-


nomic and political environment. Its approach- able regulator and representatives in Brussels ensure Malta’s interests are factored into the EU’s decision making process. Cell sharehold- ers can benefit from an OECD compliant tax efficient environment with additional peace of mind that local regulations are EU compliant and that Malta benefits from double-tax trea- ties with over 60 countries.


25.10.11 TUESDAY


EU Protected Cell Companies mean savings


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