The insurance industry works hard to try to cover every niche in every industry that needs risk management, but sometimes an innovative company still can’t find an insurer with the right kind of experience to predict their needs and offer cost-effective coverage. Sometimes, there are coverage options but they price out small businesses. Other times, there simply isn’t an option without trying to get several policies working together. In both those cases, captive insurance consulting can help entrepreneurs understand if owning an insurance company that caters to their needs will be the most efficient way to get coverage.
Assess Your Insurance Costs Comparatively
Not every company will benefit from starting a new business just to offer itself insurance coverage. Sometimes, the startup costs are just greater than the existing insurance options they could avail themselves of. The only way to know for sure whether or not your business would benefit from owning a captive insurer is to have a professional assessment done by consultants who know what it takes to successfully move coverage to a captive and what you could do with options from existing insurers.
Captive insurance companies can be set up in a variety of ways, and often companies who wish to have the specific coverage that suits their business will group their efforts, establishing co-ownership of the captive and operating it to the benefit of every business in the group. Finding companies you can co-exist with as partners for this endeavor isn’t easy, but there are consultants out there who can help you find a match. Ideally, you want to work with companies who are similar enough to yours to have congruent insurance needs, but not direct competitors in your marketplace. Often, this kind of deal will be the most cost-effective option, even for companies who could afford to set up a captive of their very own.