What is a member-owned group captive?

Learn about what makes a member-owned group captive great.

A member-owned group captive is an insurance company owned and controlled by the businesses it insures. Thousands of businesses across the US have turned to this model, spanning diverse industries and gaining greater control over their insurance.

Our Captives Provided Benefits for:

• Employee Benefits Programs
• Workers’ Compensation

Unique Benefits:

Group captives offer helpful empowerment though:

• Potential Return of Underwriting Profit: Dividends may be distributed based on positive performance.
• Potential Investment Income: Earnings on loss fund dollars.
• Enhanced Loss Control: Improved risk management services tailored to members’ needs.
• Long-Term Premium Stability: Reduced volatility compared to the traditional market.
• Competitive Premiums: Often lower than standard insurance.
• Enhanced Claims Management: More direct and efficient claims handling.
• Multi-State Capabilities: Coverage across multiple states.

Who Qualifies?

Ideal candidates demonstrate:

• Strong Commitment to Safety: Prioritizing risk management and loss prevention.
• Above-Average Loss History: A history of lower-than-average claims.
• Financial Soundness: Demonstrated financial stability and strength.

Sufficient Premium Volume: Typically a combined premium exceeding $100,000 for workers’ compensation, auto liability/physical damage, and general liability/garage liability.

Target Industries:

Group captives can be a valuable solution for businesses in sectors like:

• Manufacturing
• Automotive
• Trucking
• Healthcare
• Contracting
• Food and Beverage
• Roofing Contractors
• Towing
• Wholesale and Distributors
• Restaurant Franchises
• Agribusiness

How Does it Work?

Instead of using a traditional insurer, your business joins other similar businesses to create its own insurance company – the group captive. This provides greater control over the coverage and costs.

Why Join a Group Captive?

Traditional insurance markets fluctuate between “hard” and “soft” cycles, causing unpredictable premium changes. Group captives mitigate this volatility, offering more predictable costs. They also allow members to pool resources, lowering costs and retaining investment income.

Is it Risky?

When structured correctly, joining a group captive is not inherently risky. Reputable group captives utilize licensed and highly-rated insurance companies to issue policies and reinsurance to cover catastrophic losses. The captive focuses on smaller, more predictable layers of risk.

Dividends and Profitability:

Profits in individual loss funds, along with investment income, may be returned to members as dividends, typically after three years from the policy period’s end. This is determined by the captive’s board of directors.

Premium Adjustments:

Premiums are adjusted based on the captive’s overall loss experience. If losses are lower than projected, premiums may decrease. Conversely, they may increase if losses exceed projections.

What Sets Group Captives Apart?

Group captives offer:

• Specialized Loss Control: Programs tailored to members’ specific needs.
• Custom Claims Handling: Unique instructions for each member’s claims.
• Unique Coverage Forms: Access to coverage not typically available in the standard market.

Contact us today to explore if a member-owned group captive is the right solution for your business.