Generally, the only coverage of ART in the business sections of mass circulation newspapers or magazines is about whether paintings or sculptures are good investments. Rare, indeed, is coverage of true ART–alternative risk-transfer. So it was a welcome surprise to see a prominent story in “The New York Times” this week about Vermont “becoming” an “'off-shore' insurance haven.”
(To read the complete Times story from the top of the front page of its April 4 business section, click here.)
Of course, the content of this particular article is certainly not news to those of us who write about this stuff full time, let alone those in the field, battling to find coverage in the rollercoaster commercial insurance market.
But it is newsworthy to see a provocative article about ART in such a respected and widely read paper. Anything that lessens the mystery around the captive market is a good thing, and it should help agents and brokers who are trying to sell clueless prospects on the idea. (If it's in the “New York Times,” it must be legitimate, right?)
On the other hand, the shock of seeing captives covered in the Times–especially in a slight tone of bemusement and even bewilderment–is a painful reminder of what an esoteric field we all labor in.
Unfortunately, the article does focus too heavily on the tax advantages captives provide. Indeed, the writer sounds a little suspicious about whether risk managers who form captives aren't just looking for a tax dodge.
Of course, we know that captives have many other benefits–giving buyers more control over their insurance costs, direct access to reinsurance markets, and a safe harbor should the traditional market dry up. But none of those factors were mentioned in the Times piece.
Still, it's a start. Out of all the financial industries out there, insurance definitely gets the least in-depth coverage–and the most inaccurate. Is that because insurance is complicated, or inherently dull? You tell me.
But the fact is that the industry still has a lot of educational work ahead to make sure top financial journalists–and the general business community–get what it is that you really do.
I wish you luck.
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