Group Captive Case Study

How a group of like-minded business owners in the same industry saved money on business insurance with a group captive.

A group captive is a property and casualty insurance company owned by the members of a group.  It is often formed for a limited purpose and puts an emphasis on risk control and loss mitigation practices.


A hardening insurance market and increased competition drove members of a state concrete products association to look at alternative options for their rising property and casualty insurance costs; specifically General Liability, Workers Compensation, and Commercial Auto. 

Some members of the association banded together and formed a group captive insurance company to drive down costs, help control losses and provide greater control over claims experience.

Before forming the captive, the 31 members had obtained insurance on the commercial market, and each paid at least $253k in annual insurance premiums.  Collectively, they paid premiums just under $8M. The average rates for the group are listed below:



The members formed a group captive.  As part of the process, a selection committee was appointed to vet potential members of the group.  This ensured that only businesses that were committed to the i standards of the group were involved. 

The members of the group shared information and implemented safety procedures with the goal of minimizing losses and reducing premiums for the entire group.


The results so far have been positive, in the second year of operation, there was a premium increase in the group program. This increase paid by members was half of the increase seen by similar companies for the same coverage in the open marketplace. 

As the captive matures, the expectation is that premiums will continue to be less than comparable insurance purchased in the commercial market.

The members of the group maintain best practices and safety protocols that reduce loss frequency and loss ratios. This results in lower premiums for the members and greater profits for the captive.