With a captive insurance plan, your business becomes the insurer gaining coverage for difficult-to-place risks, and taking responsibility for claim handling and loss control arrangements.
| How It Works |
Decide which type of captive is right for your business.
- A single-parent captive is an insurance company set up to insure the risks of its parent company and/or any subsidiaries. Typically requires at least $2 million in premium to be feasible.
- Rent-a-captive arrangements are designed for organizations that want the benefits of a captive without the upfront costs or capital investment. Rent-a-captives keep your organization's own insurance in a captive owned by another party and don't participate in risk sharing with organizations using the same captive.
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| Types of Organizations That Typically Use Captives: |
A captive may be the right insurance solution for financially sound businesses that:
- are looking to actively manage their total cost of risk;
- can assume significant underwriting and investment risk;
- are committed to the captive company for the long-term;
- can commit capital and obtain letters of credit;
- want to control elements of their risk-financing program...cash flow, coverages, retentions and limits; and
- are interested in unbundled services.
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| Pros and Cons |
- Offers the potential to stabilize costs for organizations in volatile industries.
- Offers potential for improved cash flow and certain tax advantages.
- Can insure any type of risk, and offer a wide range of coverages, such as: Workers' Compensation, Commercial Auto, General Liability, Products Liability, or Professional Liability.
- Requires letter of credit or surety bond to secure arrangement.
- Must comply with government requirements for captives.
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| What The Hartford Offers |
- Licensed in all states for policy issuance.
- Risk management services to single-parent captives.
- Rent-a-captive arrangements.
- Financial strength...check and compare our A.M. Best rating.
- Flexibility...to unbundle a broad range of services, including captive management, claim management, loss control and risk management information services.
- Proven commitment...for more than 20 years handling captive and alternative market needs.
- Captive expertise.
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