ICS Captive Insurance Solutions
The Group Captive strategy brings you together with a group of like-minded businesses to form your own insurance company. Member participants own the right to their underwriting and investment income, and coverage within the captive includes:
- Workers’ Compensation
- Commercial General Liability
- Automobile Liability/Physical Damage
Group Captive Company Profile:
- Accounts with premiums ranging from $250,000 to $2,000,000
- Demonstrates entrepreneurial spirit
- Desires greater control
- Is financially secure
- Is committed to loss control and safety improvement
An insurance company formed to provide coverage to a single-parent owner, this structure is designed for any company that insures the risk of its parent and affiliated companies. Includes deductible reimbursement policy to assist companies in analyzing deductible options and structuring the preferred solutions for financing losses.
In addition to workers’ compensation, automobile liability and general liability, single-parent captive owners can fund for less traditional risks — such as subcontractor default, construction defect, errors and omissions, and warranty business.
Single-Parent Captive Company Profile:
- Designed for a company with annual premiums in excess of $1,000,000
- Set up by a corporation in order to manage its retained risk
- Provides greater accountability for all profit center programs
A unique variation on captive ownership, Rental Captives allow companies to use a legally segregated underwriting account in an existing captive — rather than forming their own captive. This provides the benefits of a large deductible program while offering the budgetary stability of a fully insured program.
Rental Captive Company Profile:
- Annual premiums in excess of $1,000,000
- Agent, association, affinity group or large individual company
- Desire to finance their risk in an existing captive structure
- Wants benefits of a captive without ownership obligations
- Looking to purchase unbundled services
Employee Benefits Captive
There is no better time than now to bring captive insurance solutions to employee benefits. Many great companies are leaving the traditional insurance marketplace as healthcare costs soar and reform creates uncertainty – you can join them in a cleaner pool! Captive alternatives for employee benefits provide a way to finance medical and pharmacy costs and retain underwriting profits and investment income, ultimately gaining more stability and predictability. In joining a captive, you become part of a larger group in the marketplace and, together, retain your own risk so you buy less insurance – gaining additional insulation from traditional market increases. Other advantages include having access to claims data and performance information, ensuring you can stay on top of trends in your employee population and manage risks efficiently.
Employee Benefits Captive Company Profile:
- 50-500+ covered employees
- Desire to take control over medical and Rx benefits premiums
- Commitment to wellness and cost containment programs
- Understand and embrace “risk for reward” proposition
Private Insurance Companies (pICS)
Commonly referred to as 831(b) Captives, pICS offer small and mid-sized businesses benefits previously only afforded by larger companies when they become owners of their own private insurance companies.
A captive insurance company that qualifies to be taxed under Section 831(b) of the Internal Revenue Code only pays tax on investment income while allowing underwriting profits to accumulate on a tax deferred basis in the captive. pICS that write lower frequency coverages and manage risk well can often maximize the tax benefits of Section 831(b). Further, a pICS with the right legal structure can also be incorporated into estate and wealth management plans.
Benefits of pICS:
- Immediate tax deductions for risks that otherwise may be retained internally by transferring risk to a properly formed captive
- Protect businesses from risks either currently uninsurable or too costly in standard markets
- Tailor coverages and policy language to enhance an existing risk program
- Protect assets from third party liability and creditors
- Ancillary benefits can include estate planning, wealth transfer and company perpetuation
Private Insurance Company Profile
- Privately held business
- Coverage enhancement needs (i.e. income protection, legal expense and/or professional liability)
- Combined annual premium for pICS coverages between $500,000 - $1,200,000
- Financially secure with strong cash flows