Partner corner: A captivating solution
ASSOCIATIONS NOW, July 2008 Community now
By: Dixie Arthur
Challenge: Association XYZ has, for many years, sponsored an insurance program for its members. Very unexpectedly, the underwriter of that program decides to pull out. Now what?
Solution: The association has few options: find another underwriter or end the program.
If Association XYZ is determined to keep a good thing going—and make it even better—they should consider creating a captive insurance company. An even easier option is to occupy a cell in an established segregated-cell captive insurance company.
Yes, Association XYZ would take on a percentage of the risk, but they’d also gain more control of the program and potentially create additional sources of revenue.
To start a captive insurance company from the ground up can be a long, complicated process. By occupying a cell in another captive insurance company, an association will get these benefits without the burden:
- Potential for creating investment or underwriting income from the existing program.
- Significantly lower costs and less up-front capital.
- Faster start-up time.
- Access to key service providers.
Look for a captive insurance company that allows you to keep your current broker and is domiciled where laws are favorable. Also make sure company representatives are knowledgeable about captive insurance programs and understand your needs.
Dixie Arthur is president, ASAE Insurance Company. Email: firstname.lastname@example.org
|Rate this item:||Comments:|
Mark Capstone , July 14, 2014
Interesting. There is only one thing about your advise...when you become a member of a cell, you also partly assume the liabilities of other members of the cell. The best way to create a captive is to find a good captive manager and have them guide you through the process. I agree with the domicile issue; find a good domicile (Anguilla comes to mind) and create your captive. Gp to www.capstoneassociated.com for information on captive insurance companies.
ASAE U Online
Models & Samples
|Find a Job
Post a Job
Board of Directors
Standards of Conduct
Endorsed Business Solutions
American Society of Association Executives™ (ASAE), 1575 I St. NW, Washington, DC 20005
|Social Media | Advertise | ASAE Foundation | Site Map | Contact Us | Privacy Notice|