The Captive Formation Process and How We Help

Capital Management Consulting, LLC will assist you at each and ever juncture of the captive formation process.  Here is a summary of the four "simple steps" required to get your domestic captive up and operating, from initial feasibility study to final sign-off by the domicile's regulator:

 

What is involved in forming a captive?

 

Step I. Research and Gather Information

  • Gather underwriting information
  • Incorporate underwriting information into a financial model to determine proposed captive’s financial viability
  • Review all financing options
  • Obtain commitment of management
  • Know objectives
  • Determine level of risk retention
  • Have sufficient premium volume

Step II. Due Diligence and Decision Making

  • Engage outside consultant/manager and actuary to develop financial models that will provide suggested retention limits and capitalization requirements
  • Begin preparing thorough feasibility study
  • Develop business plan to include marketing, financial, and operational sections
  • Determine qualified underwriting partners and begin discussions (if applicable)
  • Have initial meeting with regulator(s)

Step III. Organization and Licensing

  • Complete and file captive’s license application 
    • Key Elements
      • Contract with captive management company
      • Complete licensing application
      • Formation documents
      • Feasibility study and business plan
      • Proforma financial statements 
      • Reinsurance documents or commitments (if applicable)
      • Incorporate and capitalize captive

Step IV. Begin Operations

  • Capitalize
  • Company receives certificate of authority
  • Begin business