Who Benefits From Employee Benefit Group Captives

Long terms savings of 20% or more and a return on risk of 30% are possible

Who benefits the most from employee benefit group captives? You. Not the insurance companies—they’ve been removed from the picture. We’re trying to help you save money, not spend it. Employee group captives are created by employers, for employers.

Your return on investment might include:

  • Short-term savings through retention of the profit that would have normally gone to an insurance company, decreased state taxes, reduced or eliminated state mandated coverages, and risk selection.
  • Long-term savings through manuscript plan design (including employee incentives for positive behavioral changes), value-based benefits, reduced claims and risk selection.
  • Control through data transparency and structural optimization.
  • Limited volatility through the use of the group captive as a shock absorber for large claims or substandard years.
  • Group power through the use of a larger data pool and the sharing and implementation of best in class risk control efforts. 
  • Increased employee productivity through improved employee health, which means less working while sick (presenteeism) and less missing work altogether (absenteeism).

Engagement from the owners and managers is the key to success.

There is a strong value proposition in an employee benefit group captive. To affect the results discussed, there has to be a top down commitment to the program, beginning with the ownership and management groups. 

Pareto Captive Services screens each employer for suitability prior to beginning the underwriting process. There is no miracle cure for employee benefits; any effective solution will require an initial increase in time and effort on the part of the employer. 

We urge every employer to complete an analysis of the future impact of the rising cost of benefits. We have created a simple Margin Erosion Model to assist in the process. We believe an employer should understand the current path before considering a different one.