What is a Captive?
A "captive" operates as a closely-held insurance company formed to insure some or all of the risk of its members. For many years, other sectors of the non-profit world, such as hospitals and educational institutions, have benefited from utilizing captive solutions. Providers who join may be able to reduce and stabilize insurance costs, exert control over claim settlements and investments, recapture investment income, gain access to reinsurance markets and better manage their risk. Joining a captive can result in large savings. A captive has a Board of Managers to oversee day-to-day operations. In short, a captive is an insurance company that exists primarily for the benefit of its owners.
How It Works
The captive's profitability relies on the effective management of claims and the implementation of risk management strategies. Our risk professionals work with members in reducing their loss ratio and shifting profits from an insurance carrier to the captive. Captive members have the ability to derive financial benefits by earning return dividends from invested premium capital and maintaining favorable loss experiences.