What is a captive insurance company?
A captive insurance company is a C-Corporation (or a legal entity taxed as a C-Corporation) created for the purpose of writing property and casualty insurance to a relatively small group of insureds. There are additional benefits to creating a captive, but they should be ancillary to the primary purpose of risk management.
Who are the major participants in a captive insurance program?
Here’s an overview of the major participants in a captive insurance program: Insured: Works with its insurance broker to find a captive that fits the company’s needs. Broker: A trusted advisor that supports the insured on a regular basis.
How many captive insurance companies were there in 1981?
By 1981, the number of captive insurance companies had reached 1,400, and it grew to 1,600 by 1983. Within another three years, the number of captives exceeded 2,200, and the annual premiums rose above $7 billion. In 1986, a pivotal year for the captive insurance industry, the definition of controlled foreign corporations changed.