Risk havens in offshore financial centres play an increasingly important role in capitalist risk management. They gain strength from cycles in the insurance industry (during hard markets) and from the mystified notion of a 'litigation explosion' that is used to reduce the rights of injured plaintiffs, particularly in times when insurers experience low income from investments. The captive insurance company (which has become the most prominent in Bermuda) and the asset protection trust (pioneered in the Cook Islands) have become important instruments through which the wealthy increase their own security and reduce the compensation that they pay for misfortunes that befall the general population. While risk havens promote laissez-faire, the article concludes that democratic socialism provides the most equitable and efficient solution to the problems of risk and insurance.