You don't have to be a big guy to think big


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Historically, big-name brands such as Coca-Cola, McDonald’s, Apple and Microsoft have reaped the many benefits of a captive insurance program. A captive is essentially an insurance company that is created and wholly owned by one or more non-insurance companies to insure the risks of its owner or owners. In the past, captives were only available to companies paying around $500,000 in premiums—with more than 90% of Fortune 500 companies having a captive. Today, many small and mid-size businesses are taking hold of the idea that you don’t have to be one of the largest companies in the world to operate a “war chest” of cash strategy. A strategy that generates profits while providing extra risk protection. If it works for the big guys, why not trickle that same strategy down to a smaller scale for small and mid-sized business?

The good news is that many companies are scaling down the giant captives model into their business. A new captive offering at Guy Hurley is lowering the barrier of entry to the captive arena by offering mid-size companies paying $150,000 to $300,000 annually in insurance premiums the opportunity to own a piece of a private insurance company—an attractive option to self-insurance.

If you think about it, captives may even be more beneficial for small and mid-size businesses because they don’t have shareholders to fall back upon, unlike the giants of the world. Captives give businesses an opportunity to recapture investment income and gain asset protection. With a captive, you control the investment and manage the risk. By encouraging best practices and accountability among team members within a captive, significant profits can be generated.

Here’s where it gets even better. What if your risks never materialize? At some point, your captive may accumulate cash well above the insured risk needs of your business. These excess reserves are the major selling point to owning a captive.  For companies with a strong credit profile, financial security, and a commitment to loss control and safety, captives have significant benefits. The list goes on.

Principals and financial managers from a number of mid-size businesses are joining us this Thursday, June 23 at our Captives Seminar from 1:30 to 5 p.m. at the Baronette Renaissance Detroit-Novi Hotel to find out if a captive is a good fit for their business. Please RSVP by emailing If you can’t make it, give me a call directly at 248.519.1415 or email me at

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Posted by Richard McGregor in Captives

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