Captive Insurance - AWM Global Advisors
A Captive Insurance Company
(“CIC”) is a form of self-insurance
where a captive subsidiary company
is created to provide property and
casualty insurance for the parent
DOES IT MAKES SENSE FOR YOUR BUSINESS?
A CIC may allow the operating company to capture costs normally lost to third party
insurers, better manage enterprise risk and reduce insurance costs via direct access to
the wholesale reinsurance market.
Premiums up to $1.2 million per year paid to the captive are tax deductible. Each year
adjustment for claims payments and expenses are taken against the premium received,
and the net underwriting profits are retained in the CIC’s surplus account, where they can
be managed in a tax efficient manner.
Assets should be maintained in
the captive for at least 7 years.
Surplus capital accumulated
over the years can be
distributed to the owners as
dividends or long term capital
gains, or ownership interest
can be passed to heirs and
thus kept outside of the owner’s
estate. Shares in the captive
can be offered as an incentive
to new recruits.
BASIC CAPTIVE STRUCTURE
POTENTIAL BENEFITS OF CAPTIVES
• Reduce Insurance
750 B. STREET | SAN DIEGO, CA 92101
EMAIL: [email protected]
Greater Claims Control
• Incentives for
• Retain Premium
• Estate Planning
• Tax Benefits
• Asset Protection
• Investment Income
• Asset Growth
• Additional Profit
For additional information or for a complimentary financial consultation, please contact us.
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