Group Captive Insurance Guide:
Own The Alternative Advantage!


 A Group Captive is an Insurance Company that provides insurance to its owners and is controlled by its owners. Captives are formed by companies that have strong claims management and participate in risk sharing with other businesses in the captive. Unlike the traditional market, Captive members benefit from their favorable loss results, positioning themselves for possible financial returns on investment income and underwriting profits.


Advantages of a Group Captive

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What coverage’s can qualify for group captive insurance? Control Over Costs: Ownership Advantages:
  • Workers’ Compensation
  • General Liability
  • Auto Liability & Physical Damage
  • Premium is based on individual loss history and exposures.
  • Insulated from traditional market conditions.
  • Underwriting profit and investment income.
  • Members gain authority over program operation decisions.
  • Unbundled structure for fronting, reinsurance, and claims management.


Group Captives – FAQs

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What makes a good captive candidate?

  • Paying more than $150,000 for Workers’ Compensation, General Liability, and Auto Liability & Physical Damage Combined
  • Financially Secure
  • Desire to take control, willing to be accountable
  • Company committed to safety
Business Strategy - IconHow are premiums developed in a Group Captive?

Premiums are developed based on an analysis of the applications historical data; premiums, losses, and exposures. Expected loss funds are determined and product and service costs are then applied. This removes the company from the hard and soft market shifts.

Why should I review a Group Captive Option?

Captive programs are not for every business. We are looking for those that could qualify based on premium size, exposure, financial stability, and management committed to safety.

Smart Money - IconDo I get money back?

Yes, you can. All loss funds dollars belong to the member and investment income accrues to the member of the funds. Any unused loss fund dollars plus investment income would be returned to the member.

Is this the same as self-insurance?

No. A group captive utilizes an independent actuary to calculate expected losses based on prior performances. The member pays a premium to cover their expected losses and the service and product costs. Part of their product costs include a specific reinsurance policy to help the group manage the expense of catastrophic losses.

 

Coin Icon - WebDo I have to pay for other members’ losses?

There is a possibility for members to assume losses of other members. Group Captive models are structured to ensure losses will be limited to each individual members’ percentage in the entire group.

Is it difficult to leave a Group Captive?

No. There are no handcuff clauses. Each year stands on its own. Same one year commitment as the traditional market place.


Various Types of Group Captives

There are various types of captive programs available in the marketplace. Group Captives can be either homogeneous, all the same industry, or heterogeneous, which provides coverage to various industries.

For more information, please call Rob or Joey Micheletti at (209) 576-2808.