1. We will assist you in the completion and facilitation of a professionally drafted actuarial feasibility study and both our Captive CPA and Actuarial service providers will be more than happy to assist one’s team for this process. These actuarial feasibility studies are different from actuarial reports which are also often required by domiciles;
2. Feasibility studies are optimally completed before one makes a commitment to employ a formation and management provider like INXS Captive Management LLC;
3. If a captive program is viable, the selection of our services will be negotiated, and a management and nondisclosure agreement signed in order to keep prices practical;
4. Our actuarial feasibility study remains our intellectual property and may not be provided to third parties or used to get competing quotes;
5. Determining the optimum ownership structure and entities to incorporate asset protection and estate planning objectives is discretionary and if required our outsources associates may be engaged for their expertise in areas such as tax, wealth transfer and estate planning;
6. If the tax implications are of a severely material concern, then as a business owner one should consider obtaining a tax opinion from a qualified Captive CPA or Captive Attorney or consider requesting an IRS Private Letter Ruling before proceeding with formation.
7. Take notice that previous point is seldom embarked upon due to the excessive costs and delays associated with this type of request and it becomes unnecessary if the captive design meets with published IRS safe harbors;
8. We will conduct informal pre-application evaluations with certain US onshore domiciles of our preferrable selection. Domicile selection is critical to assure effectiveness and elasticity of operations, avert unanticipated costs and delays, have investing and dissemination discretion anticipated, and ensure a slick and resourceful dissolution;
9. We will then assist in the formal Captive application process and assemble personal and business documentation needed to apply for a captive insurance company license dependent on domicile requirements. Domicile related formation fees start at approximately $2500.00 and exceed $10,000.00 in many jurisdictions;
10. Captive management firms generally charge at least $30,000 for forming a small captive insurance company; and these fees are in addition to any legal, actuarial feasibility study, captive CPA, domicile fees or the fees of other specialists;
11. The minimum required startup capital varies amongst domiciles and the accessibility of cell or series captive programs to join in with;
12. The startup capital for a small simple Captive Insurance Company ranges from $25,000 to $250,000 or more depending on the domicile selection, sort of captive, and ownership structure;
This capital must be in an isolated account before a license application will be approved and the captive can commence doing insurance business;
13. A labor-rigorous share of forming a captive is amassing the required documentation;
14. Examples of required
documentation could necessitate an owner or director biographical affidavits, biographies, discoveries, tax returns, insured financials, policies, reinsurance agreements, conflict of interest policy, code of ethics, investment policy, corporate formation documents, organizational minutes, business plan, financial proformas, background checks, anti-money laundering affidavits, professional recommendation letters, proof of citizenship and residency, etc.;
15. After the required entities are formed such as the captive entity as well as the entity and or trusts created to own the captive and a captive insurance application submitted, considerable supplementary steps are compulsory in connection with commencing captive operations should one require captive operations and founding documentation to meet best practice standards;
16. Some of the many formation and startup related responsibilities include obtaining tax ID #s, opening bank accounts, depositing initial capital, issuing purchase orders for captive lines of coverages, authorizing premium levels, invoicing covered insureds, setting up the captive accounting system, creating an operating and procedure manual, adopting a business plan and budgets, making compulsory tax elections, conducting related formation conferences and establishing the entities corporate books, amongst a host of other activities needed to properly commence and document captive insurance company formation.
17. Once all of the above non exhaustive activities, checks and balances are achieved, the commencement of captive operations may begin.