Commercial insurance policy

Are you looking to purchase business insurance?

If yes, you have two options: The first one, which is extremely popular, is to buy an insurance policy that your business needs from an established insurance firm. Another option, believe it or not, is to set up your own insurance company, formally known as captive insurance.

In this article, our focus is on the latter.

Setting up your own insurance company might seem outrageous, but captive insurance does offer a number of significant benefits.

Continue reading to learn what you stand to gain.

1. Get Tailored Coverage

If you’ve bought commercial insurance before, you know how hard it can be to get coverage that’s tailored for your business. Unless you’re a big company, it’s hardly possible for an insurance company to give you a custom policy. You have to work with what’s in the market.

For instance, if you need business interruption insurance, you have no choice but to scour the market and find a company offering coverage that’s closest to the needs of your business.

With captive insurance, that’ll be a thing of the past. Because the captive insurance company is a wholly-owned subsidiary of your corporation, you have greater control over the insurance policies it creates.

2. Save Money

In the commercial insurance marketplace, you have little control over the premiums you’re asked to pay. In fact, it’s possible that insurance premiums are one of your biggest expenses.

Wouldn’t you love to lower your premiums while getting the best coverage? You need captive insurance.

Since you have control over the captive insurance company, you can adjust the premiums to suit your needs.

There’s another way to save money: through tax deductions. Insurance premiums are tax-deductible. So, in essence, you’ll pay premiums to a company you own, and then you’ll claim the same amount in your business taxes!

3. Great Control Over Claims

If you’ve ever had to file an insurance claim, you know how painful the process can be. From denied claims to lengthy payment timeframes, the last thing you want is to file an insurance claim.

Why worry about that when you can create a captive insurance control and gain control over the claim process? You own the company, so it’s super easy to speed up the claims process.

4. Reduced Operating Costs

Ultimately, every business decision you make is designed to make your company more efficient. Going captive is one such decision that will help reduce your operating costs.

You’ll save money when you pay lower premiums. In the event that you need to file a claim, the captive company will compensate you quickly, meaning you’ll always have money to fund your business’s day to day operations.

Captive Insurance Is the Way to Go

Captive insurance might not sound so appealing, but when you learn it’s benefits, it becomes an attractive option. If you’ve been on the fence about going captive, you now know what you stand to gain.

Keep reading our blog for more business tips and insights.