PURPOSE OF

CAPTIVE INSURANCE

As more and more companies are becoming vigilant in evaluating and understanding their risk exposures, captives can often provide an alternative to purchasing insurance from traditional insurance providers. Among the reasons for forming captives include:

· Claims Direct Management

· Meeting the company’s unique exposure needs.

· Control over service providers, claims settlement issues, and policy language.

· Providing a tax-efficient self-funding mechanism.

· Minimize cost through efficient insurance product delivery, reducing the impact of the insurance industry’s underwriting price cycles.

· Direct access to the reinsurance market.

· Providing opportunities for the company or the Industry Group to centralize the risk management function.

· Increasing control over funds flowing through the organization through possible tax benefits.

· Creating a viable profit activity.

· Potential profit center that captures investment income.

· Stabilizing the availability and affordability of insurance.

CLICK TO:

◘ Captive Purpose

◘ Captive Success Factors

BACK – USE ARROW

TO PRINT USE PRINT PREVIEW