A Florida-based residential affordable real estate client with a $1 billion total insurable value partnered with Captives Insure (C.I.) to renew a $60 million primary property policy and a $15 million excess general liability policy. Leveraging a historical property loss ratio of under 4% and a loss-free excess liability layer, C.I. secured significant reductions in both premium and collateral requirements. Through a bespoke captive insurance structure, the client recaptured millions previously spent in the standard insurance market and retained ~$4 million in gross written premium within their captive. C.I. was able to negotiate renewal terms and provide a collateral reduction of over 50% for their 2025 renewal along with a market rate premium decrease.
C.I. provided a primary $60m per occurrence property policy and a $15m excess liability policy attaching at $5m.
Policies were issued on A+ AM Best, XV admitted paper, ensuring lender-accepted deductibles and compliance with stringent financial requirements.
The captive structure enabled the client to retain approximately $4 million in gross written premium, maximizing premium retention and underwriting profit.
For the 2025 renewal, C.I. delivered a market rate premium decrease and over 50% reduction in carrier-required collateral, freeing up significant capital for the client.
Premium and Collateral Optimization
By leveraging the client's strong loss history and robust risk management, C.I. was able to negotiate substantial reductions in both premium and collateral. This aligns with broader market trends in 2025, where favorable property insurance conditions and increased carrier competition have driven double-digit rate reductions for buyers with clean loss histories. The client's ability to demonstrate a loss ratio under 4% and maintain a loss-free liability layer provided significant negotiating leverage, resulting in both immediate and long-term financial benefits.
Captive Structure Advantages
The bespoke captive insurance structure allowed the client to recapture millions in premium that would otherwise be paid to the commercial market. Premiums retained within the captive can be invested, building surplus and providing a buffer against future claims-enhancing the client's financial resilience and flexibility. The captive also enables tailored coverage and direct influence over claims management, further reducing the total cost of risk and supporting more predictable budgeting.
Collateral Reduction Strategies
Collateral is a key financial hurdle in captive insurance programs, often tying up substantial capital. C.I. implemented proven strategies to lower collateral requirements, including demonstrating sustained low claims, strong financials, and robust risk management practices. Over time, these efforts led to a collateral reduction of more than 50% for the 2025 renewal, significantly improving the client’s liquidity and capital efficiency.
Market-Leading Terms and Compliance
Policies were issued on A+ AM Best, XV admitted paper, meeting lender and regulatory requirements while maintaining flexibility in deductible structures. This fronting arrangement ensures the client benefits from both the security of an admitted carrier and the financial advantages of captive participation.
Enhanced Financial Performance: Retention of underwriting profit and investment income within the captive strengthens the client’s balance sheet and supports long-term growth.
Greater Control and Transparency: The captive structure provides direct oversight of claims and risk management, aligning insurance outcomes with the client’s operational performance.
Improved Capital Efficiency: Significant collateral reduction and premium savings free up cash for reinvestment in core business activities.
Resilience Amid Market Volatility: The captive acts as a buffer against insurance market fluctuations, enabling stable and predictable risk financing even in challenging environments.
This case demonstrates how a sophisticated captive insurance strategy, paired with expert negotiation and market insight, can deliver substantial financial and operational benefits for large real estate portfolios in today’s evolving insurance landscape.
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