Frequently Asked Questions

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Non-Tax Benefits of owning a MicroCaptive for Healthcare Services Owners

Non-Tax Benefits of a Microaptive for Contractors & Sub-Contractors

Non-Tax Benefits of a MicroCaptive for Dentists & Oral Surgeons

Non-Tax Benfits of a MicroCaptive for Solar Installers

Non-Tax Benefits of a MicroCaptive for Real Estate Owners & Property Managers

Non-Tax Benefits of a MicroCaptive for Manufacturing

The McCarren-Ferguson Act, along with recent IRS court decisions (Like  Puglisi vs Commissioner, Avrahami Vs Commissioner and others) play an important and pivotal role in highlighting the non-tax benefits and Safe Harbor Regulations for MicroCaptive Formation, leading to its increased utilization among small and medium-sized business owners in 2021-24. The rise in interest can also be attributed to the use of the PPP (Paycheck Protection Program) and ERC (Employee Retention Credit), initiatives introduced during the pandemic to support businesses and which will likely never happen again.  These programs, along with the unforeseen events of the pandemic, have significantly impacted businesses, underscoring the real need for innovative risk management to address their exposure. MicroCaptives, serving as a form of self-insurance, have become increasingly utilized as they offer risk management solutions tailored to the unique challenges faced by these businesses, providing them with a way to manage risks more effectively while also reaping the benefits of the evolving regulatory landscape.

Fortuitous Risk provides business and management consulting services to CPAs, Attorneys, Money Managers, and Financial Planners to help them improve their performance, productivity, and profitability by offering their business clients year-round educational services related to Risk Management.  FR also provides educational services direct to the business owner and helps them identify when and how they would qualify for the formation of a MicroCaptive Insurance Company. FR  works with advisors AND business owners to identify any legitimate risks they may not have considered in the day-to-day operation of their business. 

Any small to medium-sized business, regardless of size or industry, may apply for consideration and potentially benefit from Fortuitous Risk's services and non-tax benefit education. We tailor our discussions and educational solutions to meet the unique needs of each trusted advisor and business client.

Fortuitous Risk consulting is a no-cost service to small and mid-sized business owners that primarily functions to educate CPAs, Attorneys, Financial Planners, and Money Managers about the non-tax benefits of forming a MicroCaptive(MC).  If and when a business owner is qualified and determines they are interested in forming a Micro-Captive, the required MicroCaptive Plan Manager has a pricing scheduled for formation, management, and tax preparation for the MC which includes a referral fee to Fortuitous Risk upon completion of the MC formation. Fortuitous Risk is also a no-cost service to the trusted advisors of the small and mid-sized business owner.

MicroCaptive insurance is an alternative to self-insurance in which a company's ownership creates a licensed insurance company to provide coverage for itself. The main purpose of forming and utilizing a MicroCaptive is to address rising insurance costs and increasing commercial policy exclusions, and to identify, insure against, and manage additional legitimate business risks that may impact a business's day-to-day success. In many instances, traditional insurance may not sufficiently protect the company assets or the business owner may carry unnecessary risk not covered by a commercial policies. 

By creating their own insurance company, the parent company can potentially reduce their overall costs, insure difficult risks, have direct access to reinsurance markets, and increase cash flow. When a company qualifies for creation of a MicroCaptive, they are then able to work with a Risk Advisor to evaluate the risks of subsidiaries, write actuarially sound policies, work with a Plan Manager to set premiums, and ultimately insure against risk, and pay claims.  

A MC is able to distribute unused funds in the form of dividends, pay management fees, or invest the unused premiums for future claim payouts. MicroCaptive insurance companies that focus on "Safe Harbor rulings" enable the company to insure against the risks of all the company's many customers. This is an alternative form of risk management that is becoming a more practical and popular means that was made possible in 1986 through the Tax Reform Act, and is supported by US Congress based on the McCarren Furgeson Act of 1945 which gives each individual states the ability to manage all insurance activities and oversight in their state.