A Captive Insurance Company is a Property and Casualty Insurance Company that is formed to cover risks of its parent company. Captive Insurance is a risk management tool which allows businesses to more effectively and efficiently manage corporate risk. Captives are created to insure loss of income risk, otherwise known as enterprise risk, risk for which commercial insurance is not available or may be too expensive. CIC's may or may not replace traditional lines of coverage. CIC’s have been insuring risk for at least 70 years and have commonly been used by large businesses for decades. Because the cost and regulatory burden of operating a captive has declined considerably in recent years, smaller businesses can now benefit from them as well.