Structure is a capital decision. Just as you would choose the right mix of debt and equity for your balance sheet, the captive structure should fit your program's size, risks, and goals. The common forms:
- Single-parent captive. Owned by one business, insuring its own risks. The most control and the most common form for established programs.
- Group captive. Several companies pooling similar risks and sharing the captive's economics. A common entry point below single-parent scale.
- Protected cell (PCC). Your own cell within a sponsored facility, sharing infrastructure while keeping assets legally separated. Lower capital to start, faster to stand up.
- Risk retention group (RRG). A liability-focused structure owned by its member insureds, able to operate across states under federal law.
- Micro-captive. A small captive that may elect 831(b) tax treatment, with rules and scrutiny worth understanding before choosing it.
Structures can evolve. Many owners start in a cell or group and graduate to a single-parent captive as the program proves itself.
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