At Fox Rothschild, we assist clients in a range of industries in forming captives, including: general business, health care, life sciences, energy and utilities, food and beverage services and more.
To help ensure that our clients fully understand the risk management and financing aspects of forming a captive, our attorneys, working in concert with actuaries, undertake a feasibility study so that an informed judgment can be made by the potential owners of the captive. That comprehensive study includes coordination with actuaries, certified public accountants and other consultants to assess a client’s business goals, legal objectives, documents loss experience, commercial market availability, captive management and manager, corporate culture, capitalization requirements and appetite for risk retention. We pair that review with regulatory requirements, funding and government matters specific to the jurisdictions in which the clients seeks to operate the captive. Currently, 33 states, the District of Columbia and two U.S. territories permit the formation and use of captive insurance companies domestically, in addition to many off-shore locations.
Fox attorneys also provide significant post-formation risk management services, ranging from handling claims, rendering coverage opinions and defending suits nationwide in the event litigation is instituted. We regularly advise clients on incidents, claims and managing risk following the formation of the captive. This frequently involves investigation of claims, evaluation of exposure, determination of whether claims are expected to fall within the self-insured-retention of the applicable policy and budgeting for defense and indemnity costs.
Many of our clients find that the post-formation risk management process is one of the most beneficial aspects of captive formation because it enables the insured to actively participate in claim management that would normally be delegated to the carrier when coverage is purchased on the open market. Our clients also find that formation of a captive enables them to “own” the risk management /loss process, which in turn empowers them to alter the way they view and manage risk to lower claim frequency.
Fox Rothschild’s nationwide footprint enables it to defend its clients in litigation and /or to closely work with selected local counsel to assure that each incident / claim is managed properly and on budget.
Once the captive is formed, our services include:
- Advice on reinsurance agreements and reinsurance matters
- State regulatory issues
- Board, shareholder and manager education, orientation and meeting participation
- Contract and insurance program document review
- Policy review and interpretation
- Claims disputes
- Withdrawals and dissolutions
- Government investigations, inquiries and audits
- Coordination with captive manager
- Advice on post-formation risk management and all related issues