Captives can reduce risk that is there whether you insure it or not as well as create a profit center.
Risk management with captive insurance transfers risk of a business to an insurance company the insured owns. If the same risk were transferred to a commercial insurance company, the profits generated by favorable loss history would go to the 3rd party insurer’s bottom line. Captive insurance can be written in place of certain commercial policies with similar favorable losses, and that is why Captives can make risk management profitable.
Products and services that make managing your risk profitable.
Risk Assessment includes the combining efforts of:
- 1. Identifying and analyzing potential (future) events that may negatively impact individuals, assets, and/or the environment (i.e. risk analysis)
- 2. Making judgements “on the tolerability of the basis of a risk analysis” while considering influencing factors (i.e. risk evaluation)
In layman’s terms, risk assessment identifies areas where potential mishaps are likely to occur, the consequences of said mishaps and the level of risk tolerance for identified mishaps. Resulting data regarding mishaps should be both qualified and quantified.
Risk Assessment provides crucial data which is part of a company’s overall risk management process.
Captive insurance enables a business to form an insurance company to insure its’ own unique risks.
Captive insurance enables an operating business to form an insurance company to insure its’ own risk. There are many benefits to owning an insurance company, such as:
• Covering exclusions that are in commercial policies
• Better risk awareness
• Creating a profit center
• Enhanced management of risk
• Tax benefits
Our expert captive management team has decades of combined captive experience. Thus, our captive owners confidently enjoy lower risk, creating a profit center and potential tax benefits.
MSI Captives Frequently Asked Questions
Remember when policies are priced, claims are factored into policy pricing as insurance companies know they will have claims, captives are no different as they are licensed insurance companies.
It is recommended as a captive manager will have the experience in making sure that the captive has all the qualified service providers needed whether in-house or outsourced to keep the captive in good standing with all applicable regulatory and compliance needed.
This comes down to being in the right structure based on your business size. Captives have different structures based on what the business is seeking from a captive, that is why businesses gross 1 million or more in annual revenues per year can participate in a
captive solution where the benefits exceed the cost.
Let Us Help You!
For over a decade, Risk Management Made Profitable and Management Services International (MSI) have provided alternative risk solutions, as well as formation and management services to wide range of companies in various industries. We certainly understand that you face a lot of risk as a business owner or risk management professional and that there are exposures and risks that can’t be covered with traditional insurance.