Protected Cell Company
What Does Protected Cell Company Mean?
A protected cell company (PCC) is a company system that consists of a core company and its cells. The cells are business units that have their own assets and liabilities.
While they are part of the same company, a cell cannot use the resources of another cell without the approval of those overseeing that cell, nor will legal action against one of the cells affect the others.
It is also known as a segregated portfolio company (SPC).
Insuranceopedia Explains Protected Cell Company
Separating the financial assets of each cell protects it from the misfortunes or wrongful actions of the others. A cell cannot simply dip into the funds of another to pay for its liabilities, for instance. This fiscal independence can also absolve the core company of certain financial and legal burdens.
PCCs can only be functional in states that legally recognize this particular system.
