A captive insurance company is a wholly owned subsidiary insurer that provides risk mitigation services for its parent company or related entities.
What is the meaning of captive insurance?
Captive Insurance Companies. Last Updated 2/28/2021. Issue: In its simplest form, a captive is a wholly owned subsidiary created to provide insurance to its non-insurance parent company (or companies). Captives are essentially a form of self-insurance whereby the insurer is owned wholly by the insured.
What is the difference between captive and non captive?
Definition of a captive or non-captive part. A captive part is a dealer supplied Original Equipment Manufacturer (OEM) part. A non-captive part is a part that is provided by all other industry sources that supply used or aftermarket (jobbers) parts.
What is the purpose of a captive insurance company?
A captive insurance company represents an option for many corporations and groups that want to take financial control and manage risks by underwriting their own insurance rather than paying premiums to third-party insurers.
What are the two major types of captive insurance companies?
Series LLCs and Cell Companies.