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Is Captive Insurance Right for Your Business?

It’s worth considering, especially if you have been seeking an insurer who can confidently service every aspect of your company’s insurance needs and you haven’t found one. There are a lot of insurers set up for general policies, but if your company has unconventional coverage needs, it’s often a matter of juggling many providers and quotes, as well as overlapping payment periods. If you invest in captive insurance, though, you can easily streamline the process by creating the insurer who can fully service your business.

Streamline Payments and Costs

When you set up a captive company, you’re basically creating a service business owned in part by your company. It’s possible to fully fund a captive yourself if you need to, but it’s often more cost-effective to pool resources with a couple partner companies to make an insurer who can take care of all of you, with a bigger risk pool allowing for a smaller financial investment from each company involved. This insurer is built to service you, so it will be set up to provide the coverage you want, allowing you to efficiently tune your insurance quotes to make sure all your areas of liability are covered. The best part is, if the company turns a profit, the dividends come back to the very people it insures.

Get Help With Administration

The two big challenges to people looking to invest in captives are money and resources. Running a company means having the staff, administrative infrastructure, and facilities to launch a second operation, or at least outsourcing the operations to people who do. Deciding whether it’s more cost-effective to build a new organizational infrastructure oneself or to outsource the running of the new business shouldn’t be difficult once you consider how much up-front capital needs diminish when you don’t have to worry about hiring and training a staff. The best part? A lot of captive group facilitators can also help with the administrative business of the new insurance firm.