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A captive insurance company (referred to simply as a 'captive') is an insurance company that is set up and wholly owned by a non-insurance company to act as a direct insurer or reinsurer for the parent company and its subsidiaries.

The primary purpose of a captive is to reduce the company's total cost of risk. Captives are often used as an integral part of a company's international insurance program but can also cover local risks or be used in a purely domestic structure.

Captive Benefits

Captive Insurance is an arrangement where business owners can take control of their insurance costs either in a group of like-minded business owners or on their own.In either case, the assistance of a captive professional is recommended.

Some of the benefits of Captive Insurance include:

  • Get up to 55% of your GL/WC/Auto premiums returned.
  • Generate investment returns on premiums paid.
  • Pay premium based on your loss history.
  • Escape the rising/falling insurance pricing roller coaster.

The Chestnut Hill Insurance Group Captive Division Consists of Four Distinct Operating Units:

  • Consulting/Captive Management
  • Agency Captive
  • Group Captives
  • Association Captives

Consulting/Captive Management

  • Feasibility and Pre-Feasibility Studies
  • Evaluation of loss runs accuracy
  • Selection of captive service providers
  • Assist with domicile selection
  • Assist with reinsurance attachment decision
  • Ongoing guidance of captive operations
  • Board meeting organization and guidance

Agency Captive

  • Access to Chestnut Hill Insurance's extensive retail book clients
  • Agency acquisitions and succession arrangements to expand the target universe
  • Organic growth Plan

Group Captives

  • Involve CFP and Estate Planning Attorneys to source candidates
  • Educate agents and solicit one-offs

Association Captives

  • Show existing associations how to save money, improve performance, and be eligible for dividends
  • Form associations to provide ongoing captive benefits by providing an alternative to the standard market

Who can we help?

  • Business owners contemplating captive involvement
  • Agents needing assistance helping large commercial clients inquiring about captives
  • CFPs inquiring as to the financial benefit to their clients, including investments and estate planning

Evaluation Process

  • Is the timing right for captive involvement?
  • Client ability to take risks and at what retention
  • Fronting carrier's current appetite and future ability to accommodate changes
  • Current loss activity
  • Current loss control program
  • Make-up of available Group Captives
  • Domicile Selection (onshore vs. offshore)
  • Tax Implications
  • Collateral Requirements