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All About Captives
In recent months, captives have come to the forefront of the insurance industry. And, as a result, there has been increased interest in what they are, the benefits they provide and if they are a viable option for companies.
A captive is a privately held insurance company, and it can be a subsidiary of the insured business. It issues policies, collects premiums and pays claims, just like a commercial insurer; however, it does not offer insurance to the public.
While a captive can be a great financial tool, it will not work for every business. In order to create and operate a successful captive insurance program, the operating company must generally have a substantial amount of risk. That risk can be insured commercially, or it can be self-insured by the business. If a particular area of risk is already insured, then the business may elect to cancel its current commercial policies and insure those risks with a captive. If the risk is already being self-insured, there may be certain benefits of financing that risk via a captive. Other qualifying characteristics include:
- Profitable operations, with taxable income ranging from $1.5 to $100 million;
- $250,000 or more of self-insured or uninsured business risk;
- 100 or more employees; and
- $500,000 or more of commercial insurance expenses.
The Internal Revenue Code, related IRS rulings, and case law all support the use of captive insurance companies to manage risk. When properly employed, the use of a captive insurance strategy can help a business owner to better manage his or her insurance costs, control claims, accumulate surplus in anticipation of unforeseen risk, and allow for the accumulation of wealth on a tax-deductible basis. And while the company may exhibit the above stated characteristics, how does a business owner know if his or her business truly qualifies for a captive?
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?