What is a Captive Insurance Company?

A small pure captive insurance company (“CIC”) is a bona fide insurance company created to provide supplemental Property and Casualty (P&C) insurance to the small business owners.  The coverage provided by a CIC serves as a supplement to a business owner’s commercially obtained P&C insurance.  Implementation of a CIC can provide a business owner many benefits, including reduction of cost of insurance, liquidity to pay commercial deductibles, and the ability to customize insurance coverage (which may otherwise not be available or is prohibitively expensive in the commercial insurance market).  In addition, a CIC provides a business owner control over premiums and claims, rather than allowing such control and profits to be retained by a third party commercial insurance carrier. Introduction to Micro Captives