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Captive Insurance Programs

Attention Commercial Employers & Business Owners:

Are Captive INsurance Programs Right for you?

If the following is true for you, you should talk to us about exploring captive options.

  • Superior loss or claim history
  • Financially strong
  • Premiums that are not reflective of losses
  • Superior safety Program

Who is Eligible? Why Captive Insurance?
Employers that: Employers Join to:
· Have a Strong Track record of Safety · Access Best in Class service
· Pay at least $125k in traditional premium · Save expenses via economies of scale
· Have a better than Average Loss History · Stabilize annual insurance spend/costs
· Are tired of subsidizing the general insurance market · Recapture insurance company profits and  investment income


Does your company have a good loss history?

Historical loss ratios are often not the best measure of a good loss history. A reasonable measure might be the average incurred losses over the last five years, divided by the estimated first dollar premium at renewal. If this ratio is 30-60%, it is probably a good candidate. Loss estimates are complicated, and this test is not definitive, just general guidelines.

Is your business financially robust?

A captive program typically requires a greater level of funding during the first two policy years than a fixed-cost program. Many employers simply cannot afford to dedicate additional capital to an insurance program, even if it leads to lower ultimate costs. The ability to obtain a letter of credit from a bank can greatly reduce the cash outlay required to start a captive insurance program.

Do you have the willingness to learn the complexities of a captive insurance program?

The concept of a captive is straightforward, but the execution can be complicated. Employers need to feel “pain” in order to have a real interest in a captive. This pain is normally created by rapidly increasing premiums, a feeling of lack of control, or poor service. Typically, the line of coverage being considered has to be a large expense item before it becomes a significant issue to the employer.

Do you believe you are capable of controlling your costs?

Some employers simply believe they are along for the ride. These are not good candidates for a captive.

These questions are meant to only be general guidelines. To determine if a captive program is a viable option for you.

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