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Captive Insurance Company Feasibility Study,
Captive Feasibility Study, Captive Feasibility, Captive Insurance Feasibility,
Captive Insurance Feasibility Study
The first step to owning your own
Captive Insurance Company begins with a Captive Feasibility
Study from WMS.
Each Captive Feasibility Study
we perform is custom
tailored to meet our client's individual needs. This means that your
Captive Feasibility Study will be developed using your data not
industry wide data, and all of our recommendations will be tailored to meet your unique business and personal
goals. Your customized Captive Feasibility Study
will answer most if not all, of the questions you have regarding the costs
and benefits of owning your own Captive Insurance Company. Although it is not as
detailed as the Captive Business Plan which is required to form a
Captive, it does provide an excellent Executive Overview and Summary of
the most important aspects of your Captive. Your customized Captive Feasibility Study
will contain the following key components:
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A
Multi-Year Cost Benefit Analysis - WMS
will perform a
cost benefit analysis which will compare the economics associated with
forming a Captive Insurance Company to the economics associated with not
forming a Captive. The Cost Benefit Analysis will compare these 2
scenarios over a 1, 5, 10, 15 and 25 year time frame.
http://www.wmsolutionsnow.com
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5 Years of Pro Forma Financial
Statements - WMS will
prepare 5 Years of Pro
Forma Income Statements and 5 Years of Pro Forma Balance Sheets for
your Captive. Each annual statement will include estimates of your Captive's:
premium income, investment income, loss costs and other operating expenses,
profits, cash and other assets, liabilities, capital and surplus. Each
statement will also include a calculation of the minimum required capital and
solvency margin, and the minimum required reserves levels which your Captive
must maintain in order to be a licensed insurer in the domicile.
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Captive Insurance Tax Analysis
- WMS will analyze the impact that forming a Captive Insurance
Company will have on the State and Federal Taxes which you and your
businesses currently pay. This will include
a review of your current State Business and Personal Income Tax Rates and
potential savings, as well as a review of your current Federal
Business and Personal Income Tax Rates and potential savings. It will also
include a summary of IRS Safe Harbor Rulings as well as the tax
incentives which are currently available to small property and casualty
insurance companies under Section 831 and Section 162 of the
Internal Revenue Code. For clients who currently own voting stock in
a privately held insurance company, we will also include a review of the
effect which the "Controlled Group" statutes found in
IRC Section 1563 will have (if any) on their Captive's taxation
under IRC Section 831. Finally, your customized Captive
Feasibility Study will also contain a review of the costs and benefits
associated with obtaining an IRS Private Letter Ruling for your
Captive.
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Identification of the specific Insurance
Coverages and Limits your Captive will provide - WMS
will identify specific commercial property and casualty risks, which you are
not currently insuring, that can be insured by your Captive.
WMS
will provide a list of suggested Coverages your Captive should
provide including Limits of Insurance and rough Premium estimates.
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Meeting Your
Captive Reinsurance Needs
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WMS will provide you
with sample reinsurance agreements which your Captive will utilize in all of
its reinsurance transactions. We will also provide you with a list of
qualified reinsurers who can meet all of your reinsurance needs at an
affordable low price.
-
Document the Captive's Business Purpose -
Your Captive Feasibility Study will begin by documenting
several business purposes for creating your Captive Insurance Company.
It is important to clearly document your rationale for establishing a
Captive Insurance Company in order to satisfy IRS requirements that require
a valid "business purpose" for creating or operating a company, especially
one which
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incentives.
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Selecting the Best Domicile for your Captive Insurance Company
- WMS will help you to select the best Domicile in which to
incorporate, license, operate and manage your Captive.
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Captive Structure Selection
- WMS will help you to select the Captive Structure which best meets
your needs ( i.e., Single
Parent Captive, Association Captive , Group Captive, Industrial Insurance
Captive, Rent a Captive, Sponsored Captive, Protected Cell Captive,
Segregated Cell Captive, Affiliated Reinsurance Company (ARC), Producer
Owned Reinsurance Company (PORC) Closely Held Insurance Company (CHIC), etc.
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