An alternative to traditional business insurance, member owned Captives are insurance companies that provide insurance to, and are controlled by, its Owners. The Owners actively participate in decisions influencing the underwriting, operations, and investments of the Captive. Captive insurance company Owners also benefit from underwriting profits and investment income.
Traditional insurance companies are subject to market changes, shifting underwriting appetites and stock analyst expectations. A Captive insurance company provides stability for companies that want to take financial control and proactively manage their insurable risks. Companies that are committed to safety and have an excellent loss record would be smart to consider a Captive insurance option.
A Captive insures specific risks of its multiple Owners generally reducing operating expenses while returning underwriting profits and investment income in the form of Owner dividends. Under traditional business insurance, underwriting profits and investment income gains are retained by third-party insurance companies.
Homogeneous Captives insure Owners representing the same industry segment. Heterogeneous Captives are those whose Owners represent diverse industries. Captives are incorporated either domestically or offshore.