Captive Insurance
A Strategic Approach to Managing Business Risk
What Is Captive Insurance?
Captive insurance allows a business or farm operation to form its own insurance company to cover specific risks. Instead of relying entirely on the traditional insurance market, a captive gives you greater control over underwriting, claims handling, and long‑term risk strategy.
Why Businesses Consider a Captive
Captive Insurance
Many organizations choose captive insurance to gain more control over their coverage and costs. Common reasons include:
• Traditional insurance being too expensive or excluding key risks
• Desire to manage risk internally rather than paying commercial insurer profits
• Ability to tailor coverage to the unique risks of a business or farm
• Potential long‑term cost savings when losses are lower than expected
How a Captive Can Help Your Business
Loss control and risk‑management programs designed around your actual needs. A captive can provide specialized coverage for:
Liability exposures
Property and equipment risks
Gaps left by traditional carriers
Unique or hard‑to‑insure risks specific to your operation
Who Is a Good Fit for Captive Insurance?
Captive insurance is often beneficial for:
Businesses or farms with steady, predictable losses
Organizations paying high premiums or facing limited availability of coverage
Operations wanting more influence over risk‑management programs
Companies seeking alternative ways to finance long‑term risk
Potential Financial Advantages
Depending on your structure and eligibility, a captive may offer benefits such as:
Retaining underwriting profit when claims are lower than expected
Building reserves within your own entity rather than paying commercial insurer overhead
Deductible premium payments in certain circumstances
Increased transparency into how premiums are used and invested
How Nebraska Owner’s Insurance Agency Supports You
We assist businesses and farms in determining whether a captive is an appropriate option by:
Reviewing your existing insurance structure and loss history
Considerations Before Forming a Captive
Although captives offer significant advantages, they also require careful evaluation. Important considerations include:
Need for disciplined risk management and claims oversight
Ongoing compliance and reporting responsibilities
Capital requirements to establish the captive
Determining which risks stay in the captive and which remain with traditional carriers