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capital at risk

Capital at risk is capital that is available to support the retention of risk by a self-insurer or underwriter of risk.

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Additional Information

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.

Related Terms

Risk capital is the capital required to finance the consequences of business risks.

Surplus is the amount by which an insurer's assets exceed its liabilities.