Captive Solutions for Manufacturing Businesses
There are many benefits of employing a Captive insurance program, including cost savings. In fact, 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. So, 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? Here’s one example.
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.
Current employee benefits plan becomes exponentially more costly each year.
Cost savings with Clark & Lavey’s Group Captive program, InCap®!
In 2014, Pierce decided to switch to InCap®, in an effort to reduce costs while maintaining benefits plan quality for employees. In that first year alone, the company saved $317,000. Due to the success of the program for both the company and employees, Pierce decided to remain on a Captive plan and has been saving significantly each year. Peter Langdon, Pierce Aluminum’s VP of Human Resources remarked, “The way I look at it, every fifth year, I get a free year of insurance.”
Here’s a breakdown of Pierce Aluminum’s cost savings since 2014:
2014 = $317,000
2015 = $526,000
2016 = $896,000
2017 = $466,000
2018 = $707,000
Total savings over five years = $2,911,202