How Captive Management Can Help Your Business

Insuring your business can be tricky, and captive insurance offers some unique benefits. However, if you decide to foray into the world of captive insurance, you should consider working with a captive management company. Here are a few ways captive insurance management services can help your business.

captive management

You Reap Financial Benefits

Normally, when you buy insurance, you pay premiums, and although you get peace of mind and coverage if you need to make a claim, you don’t earn any money from the insurance policy itself. With a captive insurance plan, you pay in the premiums, they earn money, and if you never make a claim, you can reclaim those funds. For this reason and many others, 90% of Fortune 1000 companies opt to use captive insurance.


You Enjoy Tax Benefits

You can claim a tax deduction on the premiums you pay to captive insurance companies. The captive insurance company doesn’t have to pay any income tax on the premiums it receives up to a certain threshold bold, and eventually, if you withdraw funds from the captive plan, you get to enjoy a relatively low long term capital gains rate. A captive management company can work with you to ensure that you get as many tax benefits as possible.


You Get Help With Tax Issues

Unfortunately, there have been a few cases where the Internal Revenue Service (IRS) has rejected claims related to captive insurance companies. When you work with a captive management company, they set up your plan to ensure that you can reap the tax benefits and avoid any issues with the IRS.


You Can Customize the Policy to Meet Your Needs

When you work with a captive management firm, they can help you customize the policy to meet your unique business needs. That is often more effective than choosing a prepackaged insurance plan.


You Get Coverage for Nearly Anything

Additionally, if you are struggling to get insurance through the traditional market, a captive insurance plan can help you get coverage which you normally may not be able to obtain. In particular, you can develop a plan that offers coverage for some of the following elements:

  • Returning defective inventory
  • Covering the cost of deductibles on existing coverage in the event of a financial issue
  • Reducing risks due to exposure to underinsured entities
  • Customer concentration risk
  • Safety concerns
  • Environmental liability
  • Malpractice
  • Product liability
  • Loss of employees
  • And more

You Get the Support You Need

When you work with a captive management company that can provide you with turnkey services, you get to reduce your risk and enjoy all the benefits of captive insurance, but you don’t have to manually manage the insurance company’s day to day business. Instead, you work with the management firm to develop something that meets your needs, but they handle the specifics for you.


To learn more about captive insurance, contact us today. At Venture Captive Management, we have the experience, knowledge, and guidance you need. We can help you minimize risk and get the insurance you need.