A group captive is a type of insurance company owned by the businesses it insures. It allows like-minded companies to band together to form their own insurance company, offering them greater control over their insurance programs and the ability to share in underwriting profits.

Group captives provide several benefits, including greater control over risk management, reduced insurance costs, and the potential to earn dividends. Members also benefit from a more stable insurance market, as they are less exposed to the fluctuations of the traditional insurance market.

Typically, companies with strong risk management practices and a commitment to safety and loss prevention are ideal candidates for group captives. These companies should also have a desire to collaborate with other like-minded businesses to achieve shared goals.

Claims within a group captive are managed with a focus on collaboration and transparency. Members of the group work together to minimize losses, and claims are handled by third-party administrators (TPAs) who are dedicated to providing efficient and fair claims processing.

While group captives offer numerous advantages, they also come with risks. Members are responsible for their share of losses, and poor performance by one member can impact the entire group. However, strong risk management practices can help mitigate these risks.

If your company is financially stable, committed to risk management, and interested in gaining more control over your insurance costs, a group captive could be a good fit. However, it’s important to conduct a thorough evaluation and consult with experts to determine if it’s the right choice.