Most people are content to use traditional insurance policies provided by old-fashioned insurers. If not, then at least they resign to the fact that there is no other option.
However, there are other choices for insurance that may appeal to certain people seeking insurance policies that better suit their needs, or offer additional value. Captive insurance could fall into this category. It is for anyone interested in going off the beaten path.
If you have already made wise financial decisions like setting up accounts with a reputable trust company in Anguilla, perhaps you are the type of go-getter who seeks captive insurance. You just need to understand the potential risks and rewards before you make a decision.
What is Captive Insurance?
The first thing you need to know is that this type of insurance exists when the insured owns the company. In other words, every policyholder is an owner of the insurance company. They grant some measure of control and decision-making ability, and able to share in profits. Unfortunately, they also share in any loss.
This is opposed to commercial insurance, where the company sells a product (i.e. policies). The clients choose the product that most closely suits their needs, and the company earns profits. Captive insurance allows those it insures to tailor policies to their particular needs as long as the captive operates within sound actuarial and regulatory guidelines.
Potential Rewards
Perhaps the best thing about captive insurance is that it offers the opportunity for the insured to create policies tailored to their personal needs. Since traditional insurance companies offer only policies that are ill-suited and overpriced, captive insurance could be the best solution.
There is also potential for greater earnings. Captive insurance companies have far fewer expenses than traditional providers. Price stability is achieved over time as the captive matures and expands risk retention capability. Therefore, even though they often start with less capital, they have greater latitude to invest and earn. Plus, underwriting profits go to owners, which in other words, is you.
Potential Risks
Captive insurance has many potential rewards, but there is also a risk factor. Those insured under its policies are owners of the insurance company. This is based on investment. If there are no claims against these policies, a surplus will grow and owners will earn money through underwriting costs.
Significant claims can put investment funds at risk. On the upside, captive insurance companies generally start by reducing underwriting costs before dipping into a surplus. In addition, the inherent obligation to limit losses means that the companies generally have a greater focus on safety and risk reduction than the average commercial insurance company. However, the old adage “no risk, no reward” aptly applies to captive insurance.
In short, captive insurance is about professionals e.g.Investors, lawyers, doctors, nurses etc. pooling together to sustain or dampen the effects of losses mainly due to litigation.
For more information on Captives and how to form them, ask us today at First Anguilla Trust Company Limited.
Owning an offshore company can offer many advantages. This applies to anyone looking to expand their business overseas, protect their assets, and benefit from favorable tax laws in another country with more accommodating jurisdictions. Before you create an offshore account, do some research. Speak to expert advisers in both jurisdictions. This will insure you understand all gained financial and legal benefits, as well as potential problems to avoid.
A plus to owning an offshore company is you can use it to handle and hold property in various jurisdictions. You can enjoy a slew of favorable features in the process. Managing property through an offshore company could be a viable solution if you hold property in various jurisdictions, or need to protect assets from inheritance taxes.
Here are a few things to know.
Financial Benefits
The main financial benefit of holding property in an offshore company, and using it to manage property, is that you stand to avoid a lot of undue taxation. Provided you incorporate in the right jurisdiction, such property is protected against your local inheritance tax.
If you own properties in several countries, the process of passing along property as inheritance could be significantly expedited, with fewer costs, by avoiding probate. In the process, you’ll be able to better protect your privacy. When assets go through probate they may become public record, causing creditors and other claimants to come out of the woodwork.
Should you choose to sell property held by an offshore trust, you’ll gain financial advantages. For example, you can sell the shares in the company instead of a straight property sale. Thus avoiding land tax in some countries. For expensive properties, the savings could be significant. Records of the sale need not be made public because it is merely an exchange of company shares.
Legal Benefits
Holding money in an offshore account has legal advantages. Minimized liability, and avoiding probate, are two major benefits. In terms of minimized liability, a corporate entity shields an individual owner from obligations, such as a visitor who suffers an accident on the property and decides to sue.
There is no need for probate, which would normally occur in the event that a property owner dies and property is left to beneficiaries. The property passed to beneficiaries through the company or third-party trusts, avoid the fees and public records associated with probate.
There are plenty of benefits to setting up your International Business Corporation (or IBC) in Anguilla, not least of which a very good reason is to visit or set up residence on this beautiful Caribbean island. That’s not really why most individuals set up IBCs though. Many are looking to expand an existing operation to international shores, start up a new corporation in a welcoming community, and/or take advantage of favorable tax laws in other jurisdictions.
As such, your IBC must meet certain minimum standards to remain in operation, perhaps including maintaining some kind of permanent presence in the jurisdiction of incorporation. For example, you may be required to have a registered address and a registered agent in order to keep your IBC in good legal standing.
Unfortunately, just meeting the minimums can be somewhat limiting. Over time, you may find that you need additional services in order to properly manage and operate your IBC. This is where virtual office services come into play, and there are a few important services your business can take advantage of.
Call Service
You don’t have to be restricted to the 9-5 routine. A call service provides you with a dedicated, local business phone number that will be answered during regular business hours. Your calls can be tailored to how you want them to be answered using your company name and information. Allowing you the freedom to manage your business how you want to.
This service is not designed to handle business for you, but only to take messages and forward them electronically. You can add the number of your call service to your contact information on your website, letterhead, and business cards so you don’t have to give out your personal phone number.
Mail and Fax Forwarding Service
Although you will need a registered address to maintain your corporation and conduct business, you’ll find that your uses of this address are somewhat limited in terms of actual mail services. In addition to a service that forwards your calls, you may also want a service that forwards mail and faxes to your corporate headquarters, your permanent residence, or a P.O. box in your location of residence, just for example.
Document Mailing Service
As a corporate entity, it’s only natural that you would have correspondence you wish to send out from your offices in Anguilla. In this case, a document mailing (or re-mailing) service may be in order. With this service you simply provide the documents to be mailed (billing, commercial offers, and other company correspondence), along with a list of recipients, and your letters will be mailed on your behalf.
![All about Fund Administration]()
Is your company interested in learning more about fund administration and what is involved in managing it? You have found the right place to start. At First Anguilla Trust we are pleased to offer fund administration as a service to our clients.
Fund administration generally covers a few areas of interest including: administration, accounting, custodial services, fund manager selection, and management. If you are in need of offshore management too, we can work with you on that as well.
Hedge fund administration also falls under the umbrella of administration services that we provide. If you are a new business looking to start up or a well-established business with years of credibility behind you we can begin your new hedge fund easily.
Some of the first steps to fund administration include:
· Calculation of the Net Assess Value including the income and expenses of the business.
· Maintaining the books
· Payment of fund expenses
· Monitoring investment compliance with SEC, Prospectus, or U.S Internal Revenue Code restrictions
By outsourcing your fund administration to us, First Anguilla Trust, we will take this burden off your plate and let you concentrate on other important aspects of running your business. You will receive regular updates on your funds just so you are aware of the progress we are making. At the end of the tax year we will produce a review for your taxes and books needed for accounting purposes.
To learn more about our fund administration services feel free to contact us by calling or emailing today!
