A captive insurance plan can be an extremely valuable tool for business owners.  Below are just a few of the many benefits that can be realized.

Risk Mitigation

  • Get coverage for uninsurable business casualty risks
  • Get coverage for holes in current business casualty policies (deductibles, etc.)

Business Planning

  • Create reserves and increase your ability to fund own expansion and at same time qualify for larger loans from banks and financial institutions

Tax Mitigation

  • Premiums are 100% tax deductible to business
  • Move assets from high tax (highest marginable bracket) to low tax environment (15% federal plus state on first $50,000 of investment income, with ability to reduce through proper tax planning)
  • Owe just capital gains on exit, with ability to reduce through proper estate planning

Tax-Efficient Investing

  • Option to mitigate ongoing taxes and create lifetime income stream through special arrangement with Security Benefit

Limits

  • Contribute $100,000 to $2.2MM annually.
  • Rule of thumb: premiums up to 10% gross revenue (possibly higher with warranty risk coverage) depending on business risks that can be covered.