Captives

A captive is a group of like-minded employers who join together and share the advantages of being self-insured without the without the risk & volatility. Your risk is mitigated by joining together with other like-minded employer groups to leverage size and predictability.

ThinkTank has several exclusive captives to choose from to fit your companies specific needs. Captives are not right for every company, and admittance into a captive is not guaranteed. But those that do join a ThinkTank captive tend love them, and are saving a lot of money.

Benefits of Captives

  • Improves cash flow because employers pay claims as they are incurred.
  • Eliminates exposure to lasers, as there are no new lasers after admission to the captive.
  • Lower costs, in the form of reduced carrier profits and reduced taxes and regulatory expenses.
  • Acts as a multi-year shock absorber when a high claim or a bad year happens.
  • Rate increases are banded each year, eliminating the risk of a huge rate increase.
  • Employers have complete control and flexibility over plan design.
  • Provides access to comprehensive data which allows employers to attach health care costs at their source.
  • Selective risk pool – only employers committed to cost containment are permitted to join the captive
  • Provides employers unparalleled access to cost-containment programs and risk management strategies.

Three Layers of Claim Financing

There are three layers of claim financing, that when combined, form the group captive program:

  1. Each employer retains a self-insured layer of claims (“Employer Self-insured Layer”). This layer is not shared with other employers and the experience is unique to each employer. It is more efficient for employers to pay all of their small, predictable claims directly, eliminating insurance company overhead and profits.
  2. The participating group of employers shares their medium-sized claims through a captive (“Captive Layer”). A captive is an insurance company that is owned by the employers. The captive provides coverage for claims that are larger than a single employer should retain individually, but appropriate for the group of employers to assume collectively.
  3. Each employer purchases catastrophic claims coverage from a common stop loss insurance company (“Insurance & Expenses”). This coverage provides protection for claims that exceed a certain amount and to cover claims in excess of the captive’s annual program aggregate and also includes the program’s administrative costs.

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