If you are thinking about captive insurance, here is what you need to know. Captive insurance involves a parent group that creates a licensed insurance company to provide solutions to the corporation. A rent-a-captive is when there is a third-party that forms a captive.
Rent Captive Disadvantages/Advantages
To form a captive is not an easy task, according to the experts at Caitlin Morgan Insurance. One of the major benefits of a rent-a-captive is that it is not nearly as difficult. Now, on one hand, you won’t own your own captive and you will not have incorporated your own entity, but there are other benefits that you may not realize.
One of these main benefits is the time that you save. It takes a lot of time and money to form a captive. There are so many different intricacies and you have to be able to hire the right staff towards the formation. When you rent a captive, you have control over your insurance program, you have minimal costs and flexibility in your programs.
A rent a captive insurance company is one that you can rent. You are able to have all of the benefits that you would have with your own captive insurance arrangement. The difference is that you don’t have to own or manage it.