Captive insurance is a must for many companies, but this is a decision not to be made without careful consideration. Many companies that sell insurance on the conventional market charge higher rates to help cover the increased costs. Ultimately, these increase benefit company bottom lines, but not the insurance customers. Captive insurance consulting can make all the difference for budget-conscious companies.
Alternative Insurance Makes a Difference
Alternative insurance demands have grown in recent decades as traditional insurance costs have risen. Group captive consulting services play a crucial role in adding customers to these captives for better overall insurance options. The best thing about utilizing consulting services is the broader range of options that they offer.
A Few Crucial Differences
One of the reasons that many businesses look to alternative insurance options is because conventional insurance features bundling of features that may not be wanted or needed. The pricing practices are also more flexible, too, being based on actual loss history instead of market trends.
There are also professionals available to help handle risk control issues that would otherwise drive up costs. Captives have standards that members are expected to adhere to, keeping costs down for the other members.
How the Costs Stay Low
Insurance captives make the maximum use of relationships specializing in loss prevention, claims administration and reinsurance. There are also investment tools that help add to the value of any services offered.
Each Captive has governance rules that give all members a voice and vote in day-to-day operations. By having a Board of Directors owned in entirety by members, there is much better coordination for all involved.
What Types of Businesses Benefit Most?
There are many business types that benefit from insurance captive services. Just some of these include oil and gas companies, agriculture, healthcare, hospitality, and more.
The companies that have the most use for captives have higher insurance premiums and better loss histories in comparison to the rest of their industries. The financial stability over a long term is usually superior as well, giving decision makers peace of mind about their choice.