THE FOLLOWING ARTICLE WAS WRITTEN BY [professional id=”11455″] AND WAS ORIGINALLY PUBLISHED IN IRMI.
A captive insurance company makes sense for many businesses. As a former captive insurance regulator and now in private law practice, I’m often amazed at the creativity and ingenuity of captive owners, captive managers, and insurance professionals who design and implement unique risk management solutions through the use of a captive. Captives often provide solutions to problems that the commercial insurance market cannot solve.
I’m often asked by captive owners or seasoned captive insurance professionals to review a captive program and opine if it is a “good” captive. The motivations for this question vary. Some want to make sure the captive is ready and able to cover the risks it is insuring. Others want to make sure that the proposed captive complies with both state regulations and eligibility for the appropriate federal tax status while meeting the captive owner’s risk management goals.
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