Benefits Captives: What Your Competitors Are Doing
Industry News
Thursday, June 05 2025
While it’s no secret among business and HR leaders that Captive Insurance has become the option of choice for organizations willing to take a non-traditional approach to managing employee benefits costs, some organizations remain wary. Alera Group’s recent webinar “Balancing Cost and Care: Could a Captive Solution Be the Right Fit for You?” dispels any exotic notions about Captives, outlining the forms they take, how they work and what kinds of businesses are best suited to them.
Rise of the Captives market
In one form or another, Captive Insurance has existed as a risk management solution for many decades — originally for property and casualty coverage and primarily for large employers. But its viability as a solution for employee benefits and for midsized businesses has increased dramatically in recent years, fueled by volatility in the insurance market in general and by the skyrocketing cost of health insurance in particular.
As Alera Group reported in our 2025 Employee Benefits Market Outlook, “Despite inflation cooling, healthcare spending is outpacing GDP and continuing to drive premiums, as employers turn to self-funding and Captives to help contain costs.”
In short, there are two main reasons more businesses are opting for Captives and choosing Alera Group as their broker:
1. Captive Insurance can provide significant cost savings opportunities, including underwriting savings, improved cash flow efficiency and elimination of volatility, and increased control over claims.
2. Alera Group’s expertise in the space has brought market leading solutions to the table, with employers seeing substantial savings, over 20% in many cases.
According to the 2024 nationwide survey that informed our Market Outlook, 16% of businesses with 10-49 employees were self-funding or using some form of Captive for health insurance, with the percentage progressively greater for each size category: 19% for organizations with 50-99 employees, 33% for those with 100-499, 60% for 500-999 and 68% for companies with 1,000 or more.
To Read More Click Here
Rise of the Captives market
In one form or another, Captive Insurance has existed as a risk management solution for many decades — originally for property and casualty coverage and primarily for large employers. But its viability as a solution for employee benefits and for midsized businesses has increased dramatically in recent years, fueled by volatility in the insurance market in general and by the skyrocketing cost of health insurance in particular.
As Alera Group reported in our 2025 Employee Benefits Market Outlook, “Despite inflation cooling, healthcare spending is outpacing GDP and continuing to drive premiums, as employers turn to self-funding and Captives to help contain costs.”
In short, there are two main reasons more businesses are opting for Captives and choosing Alera Group as their broker:
1. Captive Insurance can provide significant cost savings opportunities, including underwriting savings, improved cash flow efficiency and elimination of volatility, and increased control over claims.
2. Alera Group’s expertise in the space has brought market leading solutions to the table, with employers seeing substantial savings, over 20% in many cases.
According to the 2024 nationwide survey that informed our Market Outlook, 16% of businesses with 10-49 employees were self-funding or using some form of Captive for health insurance, with the percentage progressively greater for each size category: 19% for organizations with 50-99 employees, 33% for those with 100-499, 60% for 500-999 and 68% for companies with 1,000 or more.
To Read More Click Here