CASE STUDY · COMMERCIAL AUTO
Single-parent captive structure delivers $500,100 in annual underwriting profit potential on a commercial auto liability and physical damage program.
A Florida-based commercial fleet operator with a mixed-use vehicle schedule of 73 liability units and 87 physical damage units approached the renewal cycle with a clear objective: improve the economics of its commercial auto program without compromising on the admitted, A- rated paper its contractual obligations required.
The insured's loss profile suggested meaningful capacity to assume risk participation rather than continuing to cede underwriting margin entirely to the standard market. The question was how to structure a program in which favorable claims experience would translate directly into retained underwriting profit at the captive level — while preserving the carrier strength and admitted status the business depended on.
Captives Insure structured a fronted, reinsured single-parent captive program with 100% risk participation ceded — less third-party reinsurance — to the insured's wholly-owned captive insurance company via EmpoweredRE.
| Metric | Result |
|---|---|
| Net Premium Ceded to Captive | ~55% of GWP |
| Underwriting Profit Potential | $500,100 |
| Risk Participation | 100% (less reinsurance) |
| Underwriting Profit Ownership | 100% to Insured's Captive |
| Third-Party Reinsurance Attachment | $2M Aggregate · Unlimited Stop Loss Cap |
100% of underwriting profit and investment income on distributed surplus flows to the shareholder of the captive, building investable surplus year over year.
As reinsurer of the AM Best Rated policy, the captive owner has the ability to appoint independent defense panel counsel and direct ability to influence claims handling.
A- rated admitted paper satisfies every contractual and statutory carrier requirement while the captive captures the upside.
100% risk participation aligns the insured's loss-control discipline with its insurance economics — favorable experience compounds directly to surplus.
Outcome: By partnering with Captives Insure, this fleet operator transformed a recurring premium expense into a structured underwriting profit opportunity — recapturing ~55% of GWP at the captive level while maintaining the admitted, A- rated paper its contracts require.
Captives Insure provides turn-key captive insurance solutions that allow businesses to retain significant premium, control, and underwriting profit within their own captive — all while providing A-rated paper to satisfy every contractual requirement.
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