Case Studies

There are several benefits when employing a Captive insurance program, including cost savings. We have seen companies that are fully funded on a premium basis realize savings of 12% – 15% in the first year alone. But what does that mean? It’s hard to imagine a percentage of savings without attributing real dollar figures to it. How can you trust that the cost savings of a Captive program for your company will outweigh the effort involved with changing to a new plan? Discover how much our client, Pierce Aluminum, was able to save through our captive insurance and why they thought the switch was well worth it.

• Client Background: Pierce Aluminum, an aluminum manufacturing facility in Franklin, Massachusetts utilized a fully funded employee benefits plan for more than a decade. With nearly 200 employees and 140 on the plan, premiums were rising steadily each year.
• The Challenge: Current employee benefits plan becomes exponentially more costly each year.
• The Solution: Cost savings with Clark & Lavey’s Group Captive program, InCap®!

Peter Langton, Pierce Aluminum’s VP of Human Resources, remarked, “If you have financial stability, there is no other plan you should do. It is the right thing for your company and employees. Clark & Lavey has helped us reduce a significant amount of cost. We can control expenses while also providing quality products to employees. The flexibility in the product lets us analyze and look at trends to make educated decisions. For example, we joined a PBM to save on prescription costs and provided information regarding urgent care to save on ER costs.”

In 2013, Pierce decided to switch to InCap® to reduce costs while also maintaining a high-quality benefits plan for employees. In that first year alone, the company saved $364,000. Due to the success of the program for both the company and employees, Pierce decided to remain on a Captive plan and has realized significant savings year after year.

Langton found the savings contributed to other programs that keep their employees happy and even improve employee retention. He said, “The way I look at it, every fifth year, I get a free year of insurance,” and that, “employees are always impressed by our benefits. We retain more employees because that is something they don’t have to worry about. We take care of them well.”

Here’s a breakdown of Pierce Aluminum’s cost savings since inception in 2013:

2013 = $364,000

2014 = $339,000

2015 = $540,000

2016 = $539,000

2017 = $482,000

2018 = $902,000

2019 = $907,000

2020 = $2,012,000

2021 = $1,438,000

Total savings over nine years = $7,523,000

Pierce Aluminum is an aluminum manufacturing facility in Franklin, Massachusetts. They meet the aluminum needs of various industries including the military for more than a half-century. Pierce warehouses stock aluminum sheets, plates, and extrusions in all standard shapes, sizes, and alloys. Their aluminum processing and fabricating facilities produce custom parts and fabrications, on spec and on time.

Incap is a health insurance program that provides coverage for and is controlled by its owners. Captive programs can be formed by a single company or by groups of companies and associations such as schools, non-profit organizations, retailers, restaurants, or manufacturers. Besides cost savings, InCap® helps organizations lower health premium costs while also providing:

• Control of your plan’s benefits design
• Avoidance of unanticipated rate increases
• Data, cost, and communications transparency
• No burdensome plan negotiation
• Pooling of claims to control volatility and cash flow
• Retention of underwriting profit and investment income

You can also save like Pierce Aluminum did! InCap is your solution for increasing healthcare costs. Contact us to learn more about our group health captive program and see if your business would be a good fit. Our helpful team would love to help address your needs.

Or… See our financial case study!