What Is a Captive
Business owners form privately-owned Captive Insurance Companies to protect
themselves from the risks associated with business ownership.
Rather than paying insurance premiums for a policy to third-party insurers,
premiums are paid to the Captive. Pre-defined risks are underwritten by
the Captive with the assistance of a third-party actuarial team. Any reserves
from unpaid claims remain an asset of the Captive, protected from creditors
and available for investment or disbursement to the Captive owners.