Protected Cell Company (PCC)
A legal structure where separate cells, each legally ring-fenced from the others, let multiple captive or securitized insurance programs share a single entity.
A protected cell company (PCC) is a single legal structure that houses several cells, each legally ring-fenced from the others. The assets and liabilities of one cell cannot be seized to cover the debts of another cell or of the central structure (the core), even if one of them becomes insolvent. Guernsey legislated the model first, with the Protected Cell Companies Ordinance of 1997, and Bermuda, the Cayman Islands, Vermont and several other captive domiciles followed. The structure sharply cuts the cost of a small captive or a one-off securitization vehicle. A company or sponsor rents a cell in an already licensed PCC instead of forming and licensing a new company, and keeps the legal ring-fencing that reassures regulators and counterparties. The model caught on above all for catastrophe bonds and other alternative risk transfer instruments: each issuance sits in its own cell, and one issuance's investors do not carry the risks of another housed in the same structure.
Textbook case: a mid-sized company wants a captive without bearing the cost of forming an entirely new company. It rents a cell within an already licensed PCC in Guernsey, legally ring-fenced from the structure's other cells.
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