In captive parlance, an onshore guarantee fund using assets of the captive.
It is used to gain admission onto the National Association of Insurance Commissioners
(NAIC) approved list or to replace a letter of credit in certain fronting reinsurance
arrangements. For another use of this term, a trust fund is a formalized self-insurance
vehicle that operates pursuant to its governing trust document. Often used as
alternatives to captives for more narrowly defined business purposes and risk