Alternative Risk Transfer (ART)

Generic phrase used to denote various non-traditional forms of insurance, reinsurance and techniques where risk is transferred to the capital markets.

On a broader note it can refer to the convergence of insurance, reinsurance, banking and capital markets.

Alternative risk transfer enables firms to transfer risks to another party or to capital markets investors, with the goal of receiving protection against certain risks the transaction(s) aim to cover.

Alternative risk transfer is also seen to include other risk transfer and financing structures or vehicles, including captives and other offshore holdings.