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Jul 12, 2024 · A captive insurance company is a form of corporate self-insurance. While there are financial benefits to creating a separate entity to provide insurance services, parent companies must consider ...
- Julia Kagan
Nov 20, 2019 · A captive issues policies, processes claims, follows all applicable regulations, files a property and casualty insurance company income tax return, and has profits, if profitable, available to the insurance company owners. The difference is, with an insured-owned captive insurance company, the captive owner(s) decide whether or not to retain or ...
Jan 10, 2020 · A “captive” insurance company is an organization that exists only to meet the specific insurance needs of its member/owners. That means the business or businesses insured by the captive are its sole and total owners. Captive insurance can help a business fulfill all its insurance needs, from employee benefits and general business insurance ...
Jul 1, 2021 · One of the many reasons to choose the "captive option" is because of accounting and tax rules, which allow for the deduction of insurance premiums by insurance companies. Again, as a captive is an insurance company, reserve funds held for the payment of future losses are deductible. If a company simply increases its retention, the funds held in ...
Oct 17, 2022 · A captive is a self-insurance vehicle that can help companies keep a lid on rising insurance costs. It can also plug gaps in any risk cover left by today’s difficult insurance market – where premiums and deductibles are rising and companies retain more risk on their balance sheet. And it can work as a way to build up reserves to cover risks ...
The Definitive Guide to Captive Insurance is your one-stop resource to understand the ins and outs of captive insurance. You'll have common questions answered, be in a better position to determine if a captive is a right fit, come away with step-by-step instructions for implementing a captive, and be able to introduce the concept to your executive team confidently.
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The fact that the captive does or does not make the 831(b) election does not impact the ability of the parent company to deduct its premiums paid to the captive. Many single parent captives qualify as 831(b) captives, and a parent company (and its related subsidiaries) can potentially create multiple 831(b) captives if the total premiums will exceed $2.3 million.
