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WHAT ARE THE ANNUAL OPERATING

COSTS OF A CAPTIVE/RRG?

The chart below shows estimates of the costs of operating the captive, excluding insurance program costs. The additional costs might include fronting, reinsurance, premium taxes and federal excise tax, which vary greatly by program. A company’s actual expenses will depend on the number of lines written in the captive and the amount of service required.

Services	Estimated Costs
Captive Management	$30,000 to $60,000
Audit	$10,000 to $20,000
Actuarial	$ 5,000 to $25,000
Legal	$ 0 to $10,000
Domicile Fees	$ 5,000 to $15,000
Miscellaneous (Regulatory)	$10,000 to $20,000
TOTAL:	$60,000 to $150,000

Product Distribution, Claims, Taxes, Risk Management / Inspection, and Underwriting are in addition to the above basic service costs.

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