Captive Insurance for Businesses Ready to Take Control of Their Coverage and Costs.
For some businesses, traditional insurance doesn't offer the control, flexibility, or cost stability they're looking for. Captive insurance is a form of self-insurance that lets a company create its own licensed insurance entity to cover its risks, and it's generally designed to give business owners greater control over coverage, claims, and long-term cost. Saint Moore Insurance Agency helps businesses explore whether a captive arrangement is the right fit and connect with the specialists who structure them.
What Is Captive Insurance?
A captive insurance company is a licensed insurer created and owned by the business (or businesses) it insures, rather than a third-party commercial carrier. Instead of paying premiums to an outside insurance company, the parent business forms its own insurer, known as the captive, to cover its risks, so those premiums stay inside a company-owned entity. It is a form of corporate self-insurance most often used by established businesses with predictable losses and the financial stability to fund their own coverage.
Companies generally form captives for a few reasons: to insure risks the commercial market will not cover or prices too high, to gain more control over coverage terms and claims handling, and to potentially retain underwriting profits that would otherwise go to an outside carrier. Premiums paid into the captive fund future claims, and any surplus can stay within the business. Captives come in several forms, including single-parent (pure) captives owned by one company, group captives shared by businesses with similar risk profiles, and smaller micro-captives, and most are paired with traditional reinsurance to limit exposure on large losses.
Captive insurance is generally suited to financially stable businesses with strong risk management, recurring insurance spend, and risks that are hard to place or expensive in the standard market. It also carries real responsibilities, including capital requirements, ongoing regulatory and tax compliance, and administrative costs, so it is not the right structure for every business. Around 90% of Fortune 500 companies use captives, and mid-sized businesses increasingly access group and micro-captive arrangements as well. Whether a captive makes sense depends on your size, risk profile, and goals, so contact a Saint Moore Insurance Agency agent to talk through whether a captive insurance strategy is worth exploring for your business.
