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  • ✅ Recognize the benefits, risks, and opportunities of using a captive to finance and entity's risks, identify the aspects of a micro-captive, and recognize the types of risks that can be included in the program
  • ✅ Identify factors to be considered in evaluating the cost of risk and recognize the various ways in which the costs of financing risks through a captive can be lower than the costs of commercial insurance or self-insurance plans.
  • ✅ Recognize the federal requirements that must be met for a captive to qualify as an insurance company for tax purposes.
  • ✅ Understand the contrubution and distribution requirements of the captive and the administration functions, including required filings.

Why Us?

  1. We are the largest 831b manager in the country
  2. Clear guidance and compliance on how to structure 831b
  3. Looking to expand through trusted advisor network

Grow your practice with our strategies

  • Refer qualified clients and we will help them
  • Introduce & collaborate with us on helping your qualified clients
  • Become a Captive Insurance partner and provide Risk Management for all your clients

Who is this for?

Dental Protection Plan

The Dental Protection Plan (DPP) serves as a limited warranty, influenced by programs in other sectors, and is specifically designed for dental products. Numerous dental clinics have their own warranty offerings, but these frequently lack precise definitions and miss out on important benefits of managing an insurance company: Upholding the warranty with pre-tax money, while enhancing business cash flow.

  • Leverage cash flow efficiencies used by Fortune 500 Companies
  • Fully custom program to unique practice needs
  • Attract new patients and retain existing ones
  • Potential to increase practice revenue
  • Mitigate unfunded liabilities by strengthening your balance sheet
  • Increase treatment plan acceptance


Property Management

The Tenant Assurance program enables landlords and property managers to provide a personalized Accidental Damage Waiver directly. This approach removes the necessity for third-party insurance offerings, enhances value for current and prospective tenants, and leverages pre-tax reserves to fulfill claims while generating extra income.

  • Increase occupancy rates
  • Capture a competitive edge and gain more tenants
  • Minimize risk from damage caused by tenants
  • Protects cash flow of the business.
  • Add an additional revenue source

The Tenant Rent Protection program offers a crucial safety net for property owners, ensuring consistent cash flow even when tenants face difficulties in paying rents due to specific, qualifying events. This program is fundamental in maintaining the financial health and stability of rental businesses.

  • Protects property owners’ cash flow against tenant default.
  • Covers losses from non-payment of rent due to qualifying events.
  • Assists businesses in fulfilling their own rental commitments.


Construction & Manufacturing

The Contract Default Liability program enables entrepreneurs to safeguard against undependable suppliers or substandard subcontractors.

  • Protect business cash flow with the full value of pre-tax dollars
  • Covers losses incurred following a subcontractor’s bankruptcy
  • Covers losses incurred when a vendor is unable to complete work
  • Allows a business to fulfill contractual obligations with tax-deferred funds

The Custom Warranty enables businesses involved in manufacturing, distributing, selling physical products, or offering services to create a tailored warranty program.

  • Control your warranty claims process and strengthen your brand
  • Protect business cash flow with the full value of pre-tax dollars
  • Provides customers a limited warranty/guarantee designed to fit unique business needs
  • Increase customer loyalty with improved claims experience


Enterprise Risk Coverages

  1. Audit Insurance
  2. Legal Insurance
  3. Business Interruption
  4. Supply chain interruption
  5. Data breach
  6. Deductible reimbursement
  7. Key vendor/employee loss
  8. Reputation damage
  9. Warranty/service contracts
  10. Contractor Default + 40 more

What the experts are saying

In the Puglisi Egg Farms case, the company used an 831(b) plan for insurance against risks like bird flu as such options were unavailable through traditional coverages. 

The IRS, suspecting tax evasion, started investigating in 2017 and by 2019, declared the plan non-insurance and a tax evasion scheme, disallowing deductions and imposing hefty penalties. Puglisi contested this in tax court in 2020. The IRS, in April 2021, partially conceded on some deductions, but the main contention remained over insurance premium deductions. By May 2021, the IRS withdrew all income adjustments and penalties.

Puglisi argued that the IRS’s withdrawal left unresolved issues, particularly the recurring need for insurance premium deductions due to their business reliance on the insurance from Direct Writer. The IRS offered a closing agreement, not challenging these deductions in future. Despite Puglisi’s willingness to continue, the Tax Court accepted the IRS’s concessions.

This case was notable because it had strong facts favoring the taxpayer, and 831(b) plan owners. The IRS’s concession seemed aimed at avoiding a court ruling that might set a precedent unfavorable to its stance against 831(b) plans. This case clarifies the overwhelming need for options in risk management where traditional insurance falls short. The widespread business disruptions due to COVID-19 are a clear indicator of the inherent challenges SMBs navigate.

5 Myths about captives

Captive Insurance is only for large corporations.

Captive insurance, traditionally a strategy for large corporations, is increasingly beneficial for small businesses, offering tailored coverage, cost savings, and better risk management. Small companies can use captives to enhance risk management, offer cost-effective coverage, and diversify portfolios.

Captive insurance offers small businesses tailored coverage, cost savings, and improved risk management.

Captive insurance is too complex and expensive to set up.

Captive insurance companies, which can be established across various business types including small businesses and nonprofits, involve selecting a parent company, hiring an agent for incorporation, and choosing an underwriter for reinsurance. Despite the initial setup costs, the long-term advantages like cost reduction and improved risk management can outweigh these early expenses, making it a strategic choice for businesses with effective risk management.

Captive insurance provides long-term benefits like cost savings and enhanced risk management.

Captive insurance is a tax shelter.

Captive insurance, historically misinterpreted as mainly a tax shelter, actually yields tax benefits as a secondary outcome of proficient risk management, not as its main purpose. Enhanced tax regulations have reinforced the distinction, ensuring captives are used legitimately for risk management rather than as unlawful tax avoidance schemes.

Captive insurance offers secondary tax benefits, primarily focusing on efficient risk management.

Captive insurance replaces the need for traditional insurance.

Captives are mistakenly perceived as a complete substitute for traditional insurance, but they are better utilized as a complementary solution. Businesses can benefit from a balanced approach, using captive insurance for unique risks and traditional insurance, letting you become the masters of your own destiny. 

Captives complement, not replace, traditional insurance for a balanced, effective risk strategy.

Captive insurance is risk free.

Understanding that captive insurance carries risks, such as major claims, market volatility, regulatory shifts, or economic downturns, is crucial, as these factors can pose financial challenges. Recognizing and meticulously managing these risks is essential, as captives are a component of risk management strategies, not a solution that eliminates all risks.

Captives carry inherent risks, essential in broader risk management, not risk eliminators.