A protected cell company (PCC) is a corporate structure used in the insurance industry that allows for the segregated management of risk within a single legal entity. Each "cell" within the PCC is treated as a separate account, meaning that the assets and liabilities of one cell are not available to creditors of another cell.
PCCs are often used by insurance companies as a way to manage multiple lines of business, or to separate different types of risk. For example, a company might use a PCC to manage its life insurance and annuity business separately from its property and casualty business.
PCCs are also sometimes used by banks and other financial institutions as a way to manage different types of risk within a single institution. For example, a bank might use a PCC to manage its credit risk and market risk separately.
What are cell companies?
Cell companies are companies that offer cellular phone service. This type of service uses radio waves to communicate with cell towers that are placed throughout an area. When a customer makes a call, their phone sends a signal to the nearest cell tower. From there, the signal is routed to the called party's phone.
What is a PCC captive?
A PCC captive is a captive insurance company that is wholly owned by a risk-bearing entity, typically a special purpose vehicle (SPV), which is itself owned by a group of investors. The investors in the SPV are typically banks, insurance companies, or other financial institutions.
The purpose of the PCC captive is to provide risk management and insurance coverage for the risks of the SPV's owners. The PCC captive is typically used to insure against risks that are difficult to insure through the traditional insurance market, such as catastrophic risks.
PCC captives are also sometimes used to provide insurance coverage for the risks of other companies in the same group as the SPV's owners. In this case, the PCC captive is known as a "group captive."
How do I know which cells are protected?
There are a few different ways to determine which cells are protected in a corporate finance context. One way is to look at the balance sheet. The balance sheet will list all of the assets and liabilities of the company. The assets will be listed first, followed by the liabilities. The equity of the company will be listed last. The equity is the difference between the assets and the liabilities.
Another way to determine which cells are protected is to look at the income statement. The income statement will show the revenue and expenses of the company. The net income is the difference between the revenue and the expenses. The equity is the difference between the assets and the liabilities.
Another way to determine which cells are protected is to look at the cash flow statement. The cash flow statement will show the cash inflows and outflows of the company. The net cash flow is the difference between the cash inflows and the cash outflows. The equity is the difference between the assets and the liabilities.
A final way to determine which cells are protected is to look at the statement of changes in equity. The statement of changes in equity will show the changes in the equity of the company over time. This can be helpful in determining which cells are protected because it will show how the equity has changed over time. What are the two main cell phone companies? The two main cell phone companies are AT&T and Verizon.
Is a protected cell company a captive?
A captive is a company that is wholly owned and controlled by another company. A protected cell company is a type of captive that segregates its assets and liabilities into separate "cells." Each cell is its own legal entity, and the assets and liabilities of one cell are not available to creditors of other cells.
So, a protected cell company is technically a captive, but with some important distinctions.