When you are looking for ways to save your small business some money, it might be tempting to only look at the obvious frivolous expense that could be put aside. Things, like stocking the breakroom with snacks or changing your janitorial services, might be potential areas of savings. However, you may also be able to save money on a major expense like business insurance. It is never advisable to operate your business without comprehensive insurance, but you might be able to switch from traditional coverage to a captive insurance plan and save some money.
The experts at Caitlin Morgan strongly recommend an insurance policy tailored the specific risks exposures of your business operations. With some of the more national insurance carriers, they may offer coverage for these risks, but it isn’t an area that they specialize in. When working with captive coverage, companies or businesses operating within the same field or industry band together to form their own liability coverage. This places a tremendous amount of experience and application behind the risk management approach, but there are financial benefits as well.
The work of a captive is a self-invested type of coverage. What your business pays in the form of a premium of policy cost is a long-term investment that pays when a claim is filed. When claims aren’t filed, the profits from the investments are distributed among the companies participating. The money you spend is potentially returned with interest. Therefore, it is a cost-savings move for your company.