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Capital At Risk

Definition

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.

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