Effectively designed and managed captive insurance companies achieve these goals and objectives:
Business Goals of Captive Insurance Programs:
- Improve cash flow predictability and balances
- Retain control over risk assets (money)
- Improve risk coverage - cover uncovered risks
- Reduce risk financing cost - lower premiums
- Create new profit center
- Minimize taxes
- Increase asset portfolio liquidity
Objectives of Captive Insurance Structures:
- Avoid the volatility of the cyclical insurance market
- Tailor insurance policies and programs to your specific needs
- Improve risk management by controlling risk via improved claims management, underwriting flexibility and access to wholesale reinsurance markets
- Reduce insurance costs
- Improve cash flow
- Improve Claim Reserve Investment Management
- Capture Underwriting Profits
- Increase tax saving opportunities
- Expand wealth accumulation options
- Protect assets
- Reduce asset transfer costs
Click here to read excellent introductory articles on the benefits of successful family businesses owning a 831(b) qualifying captive insurance company.
The business risks of embarking on a course to achieve the above goals and objectives can be explored by clicking here.
