Member-owned group captive insurance

A Captive insurance company (“Captive”) is a specialized private insurer that is usually setup to provide coverage for a specific risk. Captives accept premiums that would normally have been paid to a regular insurer. If the claims paid are less than the premium collected, the captive makes a profit, just as a regular insurance company would. The difference is that the Captive owner benefits, not the regular insurer.

Captives make up 2% to 3% of the commercial insurance market and have been growing steadily in popularity since the 1960’s when the first captives were being formed in Bermuda. Today, Captives are a fixture among Fortune 1000 companies. Many smaller companies and even groups of individuals also use Captives. Competition has driven down captive formation and operational costs to the point where Captives have become a realistic option for even relatively small organizations.

Association Captives are setup to insure the risks of its members. An example of such an association could be a condominium homeowners association, whose members are the Stratas. Group Captives are like Association Captives and are made up of a collection of like-minded organizations that band together to form an insurance facility that retains some risk but spreads the risk of unanticipated losses among each other, thereby diminishing the impact of a bad loss year for one or more of its members.

Syndicates are formed by one or more Members who provide capital. Syndicates are primarily responsible for setting up insurance programs and providing ongoing management services. They employ service providers including underwriters, adjusters, and blockchain technology specialists to help with the setup and operation of insurance programs.

The insurance marketplace commonly goes through its “hard” and “soft” cycles where premium fluctuations have little relation to individual loss experience. These swings can be avoided by joining with other like-minded, successful companies to create your own group or association captive insurance company, making your costs more predictable and stable. In this way, you can lower your costs and earn investment income — both benefits you won’t receive from a traditional insurance company.

Captive8 utilizes a decentralized, AI-native operational stack with three autonomous layers: a Synthetic Actuary for AI-driven underwriting and dynamic pricing, Smart Contract Administration on Layer-2 Blockchain for premium collection, allocation, and compliance, and Vision-AI Claims Settlement for touchless claims handling using Computer Vision to verify damage and trigger instant payouts.

There are two ways to participate. Passive investors join as Members providing capital to Syndicates and earn returns based on insurance program profitability through dividends. Strategic investors can establish a new Syndicate with an existing Managing Agent or set up a new Managing Agency to oversee multiple insurance programs. Members may also sell their interests through the Captive8 exchange market.

Simply contact us and we'll go through the process of setting up a captive on our platform to provide insurance coverage to your members. Captive8 facilitates capital for insurance reserves, eliminates many time-consuming setup procedures, and manages the ongoing operations of the Captive once established.