More Money, Less Risk, Your Terms
Simply put finding captive solutions to your insurance problems means more money in your business pocketbook with less risk and you can do it on your terms. Businesses have been at the mercy or unstable economic conditions, fluctuating regulatory situations, and shifting global leaders for a number of years now. These shifting economic conditions have left companies vulnerable where it applies to day-to-day operations and net profits. Many companies transfer some of these risks to insurance companies but the changing face of litigation and insurance has left them exposed to exorbitant premium increases, fewer insurance benefits, and often denied coverage. Captive solutions offer companies a way to take control of their own insurance needs, on their own terms, and to profit from sound business practices.
Gradually more small companies are joining the ranks of their Fortune 1000 brethren and are taking control of their risk management capital. One thought of as a way to counter continually rising premiums, captive solutions have come to offer many advantages that traditional insurers have yet found a way to match. Forming a captive gives a company control over its insurance premiums and deductibles and frees them from the encumbrances of the traditional commercial insurance market. Flexibility to source risk coverage on traditional insurance lines such as liability, worker’s comp, employee benefits, and automobile coverage and to cover non-traditional coverage such as environmental impact and human resources liability, makes captive solutions a financial officer’s dream come true.
Captive solutions offer companies the chance to build insurance programs that fit their needs exactly. There is no compromise to fit the needs of an insurance company. Opening the policies to cover industry specific or company specific risks, and making policies more user-friendly help expedite claims and control administrative costs. Self-owned insurance captives allow for greater control of policies, administration, reduced costs and all of these things reflect positively on the company’s balance sheet.
In a captive environment, premium payments normally paid to a traditional insurance company are deposited directly into the company’s captive. This allows excess premiums and unused reserves to be invested. This single financial move allows the company to grow a reserve account from pretax income that is usually only available to an insurance program. This option also strengthens the captive making it a more favorable option for reinsurance that will further reduce the risk profile of the company. Captive solutions offer benefits far beyond traditional insurance.
Setting the stage for a captive can be a daunting task but using an advisory board or company to help design your captive solutions can diminish the size of the task and put professionals in your corner to help with the heavy lifting. While the benefits are great, the setup can be a stopping point for many companies. Captive solutions require professional help beyond the expertise of your normal financial and legal experts. Find those experts, set that captive, get more money, with less risk, and do it on your terms.
Visit Captive Solutions for more information or visit our blog at http://cvcourt.com/more-money-less-risk-your-terms/.