What is Captive Insurance?

Simply put, a group captive is an independent insurance company owned and managed by its members. The captive insures the risks of its owner/members by covering the predictable losses and transferring away the catastrophic, unpredictable losses. Captives typically reduce upfront premium expenses and return underwriting profits and investment income to the owner/members.

Most captives are incorporated and operate under the jurisdiction of an offshore domicile, an arrangement that allows greater flexibility and increased control over insurance services and expenditures. There are two types of group captive programs: homogeneous captives, which are made up of companies that belong to the same industry, such as contractors, trucking companies, and staffing companies; and heterogeneous captives, which are made up of companies from a wide range of industries, such as manufacturing, distribution, service and retail.

Regardless of captive type, owner/members share the common goal of gaining control of their insurance costs. Alternative Risk Resources provides clients with opportunities in both homogeneous and heterogeneous captive programs.