WGBCO Owned Captives

With the cost of traditional insurance policies constantly on the rise, many businesses are now looking for alternative forms of coverage. One of the most popular alternatives to traditional commercial insurance policies is known as an “owned captive.”

About Owned Captives

An owned captive is an insurance company that is owned and managed by your company. If the captive is wholly owned, the company will insure only your business and its subsidiaries. In most cases, wholly-owned captives are formed directly by the business they insure.

However, if you are unable to form your own captive insurance company, rent-a-captive arrangements are also available. In a rent-a-captive arrangement, your company will own only a portion of the captive insurance company in question.

Benefits of Owned Captives

Choosing an owned captive offers several notable benefits over traditional insurance, including:

  • Tax deductible premiums
  • Opportunities to earn interest on invested premiums
  • Customized coverage
  • Lower overall insurance expenses

A properly-formed captive can handle all of your commercial insurance needs, from professional liability to property insurance. In addition, if your captive meets the requirements of Internal Revenue Code Section 831(b), the captive itself can receive your premiums tax-free. In such cases, the captive company will own income tax only on the investment income it receives.

Contact the Warren G. Bender Co.

If you are interested in forming your own captive, or if you would like to explore rent-a-captive options, contact the Warren G. Bender Co. today to discuss your needs. We have more than 75 years of experience in the insurance industry, and all of our alternative risk programs have received a rating of “A” or better. After evaluating your current insurance policies and future coverage goals, we can help you decide whether or not an owned captive is an appropriate strategy for your company.