USA Risk Group Captive Readiness Tool

The Captive Readiness Tool is a tool to assess some of the key issues relating to the compatibility of your organization’s culture with the commitment to form and operate a captive insurance company. After completing the questionnaire, a USA Risk Group professional will contact you to discuss your specific results.

  1. Have you experienced volatility in coverage availability in the commercial market?
  2. Do you expect to realize instant and significant savings by having a captive?
  3. The success of a captive is very much based on the ability to manage and minimize claims costs. How much time and effort is your organization willing to commit to loss control and claims administration activities?
    No Limit on
  4. Do operating divisions, subsidiary corporations and/or joint ventures require low risk retention levels?
  5. How important is it that you separate risk financing from other operational funding?
  6. Have you considered other methods of financing retained losses instead of a captive?
  7. Do your organization's insurance rates seem abnormally high compared to your loss history?
  8. Is your organization's loss pattern fairly predictable?
  9. Does your organization need specific coverages that the commercial market cannot, or will not, underwrite?
  10. Does your organization want to include catastrophic loss coverage in the captive?
  11. Are your organization's insurance exposures more frequency or severity oriented?
    Low severity / low frequency Low severity / high frequency High severity / low frequency High severity / high frequency NA
  12. Does your organization wish to consolidate all or most of its insurance needs into a single multi-line program?
  13. Is the organization to be covered in the captive tax-exempt?
  14. Is this company privately held or publicly traded?
  15. What is your organization’s risk appetite?
    Avoid Risk Aggressive
    Risk Taker
  16. Are you considering a captive to remedy a short-term situation?
  17. Is your company rapidly growing or diversifying?
  18. Is your organization concerned with equitable cost allocation between subsidiaries?
  19. Does your organization have multiple subsidiaries?
  20. Is your organization willing to provide capital for a long-term commitment?
  21. Does the risk manager/CFO and/or senior management want to make the risk management department a profit center?
  22. Can your organization post letters of credit without disrupting the financing of other business activities?
  23. What is the cost of letters of credit for your organization?
    Less than or equal to 1/2% Greater than 1/2%, but less than 1% Greater than or equal to 1% N/A
  24. Would posting letters of credit, in an amount of approximately half of the captive`s premium, result in a reduced ability to finance other business activities?
  25. What is the total premium for all lines of coverage to be covered by the captive?
    Less than $750,000 Greater than $750,000, but less than $1,200,000 Greater than or equal to $1,200,000 N/A
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