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Are captives really worth the investment?

Captive Insurance Calculator

Our Captive Insurance Calculator will help you determine how much money you would need to invest to join a captive, what your underwriting profit could be, and your maximum out of pocket in a bad claim year.

This calculator is designed to evaluate your company's current insurance spend and how it might apply in a captive insurance company. 

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Watch this video first.

What is your Gross Premium?

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$
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Average $ Value of All Claims PER Year for the last 5 Years?

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Get Your Results

the "big 3" in captive insurance

See how much you would have saved annually. Scroll down!

Check out your results from our captive insurance calculator. This tool is the first of its kind to lay out the numbers clearly for underwriting profit, collateral requirements, and maximum possible premium. It’s straight-up transparency – no fluff, just the real deal on what to expect with captive insurance.

Underwriting Profit: $149,113

  • It’s the number every captive owner wants to see grow.
  • In this example, you can see this year’s profit is $149,113.
  • Based on the gross premium of $230,469, you earned 64.7% of the total premium as underwriting profit.
  • To look at it another way, you REDUCED the cost of your insurance by 64.7%
  • WE MIGHT HAVE A PROBLEM: If you are seeing this message, the average annual claim amount you entered caused your captive insurance company to lose money. This was due to one of two reasons:
    • You accidentally entered the wrong number.
    • Your claims were actually that high.
  • If your claims are more than 60% of your total premium every year, captives may not be the right fit for your business.
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Collateral: $221,664

  • This represents what captive owners place into escrow as a line of credit or cash to safeguard against a member not having funds to pay claims.
  • Typically, captive managers express collateral as a function of the A-fund in group captives (or percentage of premium) in other captive formations.
  • In this example, the collateral is 2X A-fund ($221,664) and is paid in installments over the first three years at $74,000 per year.
  • The collateral will remain in escrow and earn investment income.
  • Think of collateral as a security deposit.
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Maximum Possible Premium: $1,480,000

This is the most amount of premium you would be responsible for in the absolute worst year.  In order for this to happen, here is what your claim experience would be at a minimum:

  • Your frequency claims (lots of small claims between $0 - $100,000 per claim) exceeded the amount of your collateral (noted above).
  • You would have also experienced a catastrophic claim(s) that is valued more than $300,000 per occurrence.
  • As a captive owner, you know this number at the beginning of every policy year.
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Ready to consider joining a captive?

Thanks for taking the time to complete our calculator. Captive insurance offers transparency on every dollar spent.  We think it's crucial that every potential captive owner understands the good and the bad.

Do you have deeper questions about what the numbers mean for your business? Let's address them. Fill out the form, and we'll get all your questions answered.

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