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Captives
A captive is a legal entity, licensed as an insurance company, to insure a proportion of its shareholders’ risks. To put it simply, it is an insurance company owned by the captive members (shareholders).
The captive members will accept a predetermined level of risk. They will pay the associated premiums for the administration of the captive (fixed costs) to the captive insurer.
The most common lines of business underwritten in a captive include:
- Property & Business Interruption
- Workers’ Compensation & Employers Liability
- Commercial General Liability
- Auto Liability
- Professional Liability
There are many ways a captive can benefit your construction company:
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Your performance determines your cost – a true performance-based product.
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Improved cash flow
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Improved risk coverage
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Reduce insurance costs – lower fixed costs
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Access to reinsurance markets
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Lowers your total cost of risk
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Greater flexibility in coverage terms, conditions and exclusions.
There are many types of Captive Structures. Three of the most common are Single Parent / Pure Captives, Group Captives, and Rent-a-Captives.
Captives can offer a variety of benefits when it comes to your insurance costs. Contact one of our TSIB Insurance Professionals if you would like to learn more about captives.
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Learn how your construction company can benefit from a captive.