Lessons Learned from Captive in the Wilderness

Five days of flying, fishing, laughter, and building long-lasting relationships on a trip of a lifetime presented some lessons learned and relearned as they relate to captive insurance.

Let the Plane Do the Flying

The generous pilots of our trip provided the opportunity for some of our guests to co-pilot or fly the plane. As an observer, I listened carefully to the instructions and felt the reactions of the plane. While a co-pilot was flying, one key bit of advice included the pilot repeating several times, "Let the plane do the work. Don't fight or react — be proactive and anticipate."

Let your captive do the work. A business owner doesn't have to be an expert in all things insurance to own their own captive insurance company. Every captive insurance company has an administrator that actively and continuously manages the company, including compliance, a claims department, accounting, and more. Let your captive insurance company work for you.

Manage the Risk

One pilot explained the requirements for fuel reserves. This requirement is a minimum of 10 gallons of fuel when he lands. If the indicators communicate less than that, the pilot would need to adjust his flight plan to stop for additional fuel. His standard was to manage the risk better, at a higher standard — his standard — by keeping at least 20 gallons of fuel when he lands.

Manage the risk at your standard. Captive insurance companies insure risk of the operating company. They may insure exposures required by law; however, there are many additional exposures that businesses have that are not required. Insuring these exposures is at the business owner's discretion. What is your standard? Which exposures are most important to protecting your company?

Flexibility Is Key

Well-thought-out and planned logistics were in place for this trip. Those plans changed dramatically — and successfully. How? Teamwork, resources, knowledge, and adaptability allowed changes of plans which resulted in success, even better outcomes than originally planned.

Captive insurance allows flexibility. Businesses change and adapt regularly, constantly; if not, they go away. This is a good definition of business risk. Not only does risk also change for a business, the options of what exposures to insure allow a business owner to adjust as well. Expansion, contraction, cash flow, knowledge, adaptability, and long-term goals are variables which affect the variables of owning your own insurance company. Your captive insurance company in its infancy will be much different than your much more mature insurance company of the future.

The Big Fish

The big fish didn't start that way. The fish has a process of survival and growth — it survived the bad winters, the fishermen, and more. It may have even been caught and released. It had a family to teach and protect him.

The big captive has a process. A captive may have some slower years. A captive has an administrative team to teach and protect the owners of their captive insurance company. A captive needs time to grow. A captive doesn't instantly become large, yet typically captives do become larger and larger, and in fact have big growth years.

Take the Risk

Ten people accepted the invitation to take on this adventure. One individual really took a big risk! This person didn't know anyone, what kind of people were going on this trip, their behaviors, attitudes, and how he would fit in. He was originally a bit apprehensive, he did his research, he asked lots of questions, and we communicated regularly. He took the leap! Now he has nine new friends who shared in the wonderful experience and memories to last a lifetime.

Although captive insurance may be new to you, it has been around a long time. You have a team of people to support you, who think like you do. Ask the questions, do your research, communicate regularly. You will have a great experience and your captive will benefit you for a lifetime.

Lessons are learned in a variety of ways — from reading a book, watching a video, talking to someone about their experience. Ultimately, the best way to learn is to experience it. Learn the lesson of owning your captive insurance company today.