Captives | Republic Insurance

Move beyond traditional insurance and take strategic control of your organization’s risk financing

Republic Insurance Group partners with businesses ready to align risk, capital, and performance — using captives, alternative risk solutions, and advanced risk financing strategies tailored to your goals.

Captive feasibility and structuring
Strategic financing beyond the traditional market
Alignment with business objectives and risk appetite

Designed for sophisticated risk profiles

Our clients typically include:

Mid- to large-sized enterprises seeking cost of risk optimization
Multi-state and multi-entity organizations
Companies with strong loss control and safety cultures
Firms facing market volatility and rising traditional insurance costs
Industries with predictable, high-frequency risks
Owners and risk leaders focused on long-term financial performance

Whether you are exploring your first captive or evolving an existing risk financing program, we provide strategic guidance built on business objectives.

What Risk Financing Actually Is

Risk financing refers to the methods and structures organizations use to fund losses — from traditional insurance to self-financing mechanisms. Alternatives to conventional coverage allow organizations to:

Retain and finance risk internally rather than transferring it entirely
Stabilize insurance costs in volatile markets
Access underwriting profits and investment income
Build customized coverage for exposures that are hard to insure conventionally

Captive insurance explained

A captive insurance company is a licensed insurer created to insure the risks of the parent company and, in some cases, affiliated or similar entities. It allows organizations to use their own capital to provide insurance and gain greater control over their risk programs.

Captive Insurance Solutions

Captives can be structured to meet different organizational needs, including:

Single Parent Captives – Owned by a single company to insure its own risks and affiliates
Group Captives – Formed by a group of companies to share risk and benefit collectively
Rental / Segregated Cell Captives – Allow multiple participants to participate without full captive ownership commitment

Each captive structure has its own capital requirements, governance, and coverage opportunities — and the right choice depends on your size, risk tolerance, and strategy.

Alternative Risk Transfer (ART) & Other Solutions

Alternative solutions can complement or extend captive approaches. Common ART strategies include:

Utilization of non-traditional funding mechanisms such as catastrophe bonds, finite reinsurance, and structured products
Custom risk financing tools for exposures that don’t fit neatly into standard markets
Strategic retention layers and non-traditional risk pools

These tools can help organizations diversify their risk finance portfolio and succeed where traditional markets struggle.

How Republic Helps You Build Strategic Risk Financing

1. Risk & Financial Needs Assessment

2. Feasibility & Design
We evaluate captive feasibility — including financial modeling, regulatory considerations, and optimal structure (single, group, rental, etc.).

3. Implementation & Compliance
We assist with domicile selection, regulatory engagement, captive formation documentation, and coordinating with captive managers, attorneys, and actuaries.

4. Ongoing Performance Optimization
We help manage claims strategies, safety programs, and strategic reviews to improve captive performance and reduce overall cost of risk.

5. Alternative Strategy Integration
We develop integrated solutions that may include layered captives, ART products, risk retention groups (RRGs), or structured financing tools.

When organizations consider these solutions

Common triggers include:

Traditional insurance costs rising or coverage becoming restricted
Desire to retain underwriting profits and investment income
Large, predictable loss exposures with strong safety cultures
Need for customized coverage beyond standard markets
Multi-year financial planning for risk costs
Strategic desire for risk ownership and control

Used effectively, these strategies help stabilize cost of risk and provide financial predictability in uncertain markets.

Long-Term Strategic Value

Cost Control: Potential to lower total cost of risk
Predictability: Reduced exposure to market rate swings
Retention of Profits: Benefits from unused premium funds and investment income
Strategic Coverage: Ability to insure risks that are difficult or expensive to place in commercial markets
Enhanced Risk Management: Aligning financial and operational performance

These benefits make risk financing viable for clients who want control over how risk is funded and managed.

Frequently Asked Questions

1) What is a captive and why might my organization consider one?
A captive is an insurer you control to fund your own risk exposures — helping manage cost of risk and retain underwriting profits.

2) How is alternative risk financing different from traditional insurance?
It uses non-traditional mechanisms — like captives or structured finance tools — to fund risk, often providing greater control and cost predictability.

3) What types of risks can captives cover?
Captives can cover traditional lines like workers’ comp, GL, and auto — and also non-traditional exposures such as cyber, excess liability, or unique industry risks.

4) Who typically benefits from captive solutions?
Organizations with strong safety records, predictable loss patterns, and desire for financial control are usually the best candidates.

5) How long does it take to implement a captive?
Implementation timelines vary by structure and domicile, but thoughtful planning and feasibility studies are critical before formation.

6) Are captives only for large companies?
Various structures — including group or rental captives — make alternative solutions accessible to organizations of different sizes.

7) Can a captive lead to cost savings?
Yes — through underwriting profit retention, investment income, and tailored risk financing. However, benefits depend on organization performance and risk management.

8) Do we need special advisors to explore these options?
Because captives and alternative solutions involve financial, legal, and regulatory complexities, professional guidance is recommended.

Let’s align risk financing with your business strategy

Whether you’re exploring the formation of a captive, evaluating alternative risk solutions, or seeking broader strategic risk financing, Republic Insurance Group can help build a customized path forward.