Captive insurance is transforming employee benefits as rising costs and demand for transparency drive employers toward better benefits and total transparency.
Key Takeaways
- Captive insurance adoption in employee benefits is accelerating: Over 40% of employers are either using or considering captives as an alternative financing option for employee benefits, according to WTW’s 2025 Benefit Trends Survey
- Cost pressures are driving innovation: With medical trend rates expected to remain in double digits for 2025, employers are seeking transparent alternatives to traditional insurance models
- BeneRe’s recognition validates the model: Being Highly Commended in Captive Review’s 2025 US Awards demonstrates the growing industry acceptance of captive solutions for supplemental benefits
- Value redistribution is key: Unlike traditional models that prioritize carrier margins, captive models like BeneRe’s return unused premiums as dividends to reinvest in employee health and wellness programs
- Transparency builds trust: Employers gain unprecedented visibility into claims performance, costs, and outcomes through captive structures like the BeneRe model.
Across the insurance landscape, interest in captive models has surged, and for good reason. Once the domain of large property and casualty programs, captives are now transforming how employers manage risk, cost, and value in employee benefits.
In the U.S. market, this trend has reached a tipping point. The numbers tell the story: WTW’s 2025 Benefit Trends Survey reveals that over 40% of employers are either using or actively considering captives as an alternative financing option for their employee benefits programs. This represents a dramatic shift from just a few years ago when captives were primarily associated with workers’ compensation and general liability coverage.
The Perfect Storm Driving Change
Several converging factors are accelerating this movement toward captive solutions:
Rising Healthcare Costs: Medical trend rates are projected to remain in double digits for 2025, continuing the upward trajectory that has strained employer budgets and employee wallets alike. The average premium for family coverage has increased by 22% over the last five years, creating an urgent need for more cost-effective solutions.
Demand for Transparency: Employers are increasingly seeking greater transparency, control, and alignment of interests, particularly in voluntary and supplemental health programs where traditional insurance models often fall short. The undisclosed nature of traditional carrier pricing and profit distribution no longer satisfies sophisticated buyers. Transparency brings efficiency.
Alternative Risk Management Evolution: The captive insurance market continues to evolve as organizations seek more flexible risk management solutions that adapt to their unique needs and provide greater control over their insurance programs.
Recognition of Innovation
At BeneRe, we’ve seen firsthand how this growing curiosity is translating into real momentum. Our group captive model, which was Highly Commended in Captive Review’s U.S. Awards 2025 under the “Captive Program of the Year” category, reflects the broader movement toward efficiency and equity in employee benefits.
This independent recognition from a panel of industry experts validates what we’ve long believed: that the traditional approach to supplemental benefits needed fundamental restructuring. Our model demonstrates that better coverage, transparency, and shared success can coexist within a sustainable benefits ecosystem.
The Value Redistribution Revolution
Unlike conventional fully insured products that prioritize industry margins and broker commissions, the captive model redistributes value where it belongs. Through our innovative captive structure, managed by Strategic Risk Solutions, we’ve created a system that:
- Returns potential dividends directly to employee health and wellness funds
- Increases actual claims paid to employees when they need it most
- Reduces overall costs for both employers and employees
- Provides unprecedented transparency into program performance
This approach represents a fundamental shift in how organizations think about risk sharing and employee protection, moving away from traditional models that often prioritize carrier profits over employee value.
Beyond Financial Efficiency
The rise in captive interest isn’t just about cost savings, though those are significant. It represents a fundamental shift in how organizations think about risk sharing and employee protection. The captive model creates a structure where diversification of risk and reduced expenses ensure optimal coverage and cost-effectiveness for all participants.
This innovative approach has demonstrated strong market appeal, showing that employers are ready to embrace transparent, employee-centric benefit structures that align interests and deliver measurable value.
The Broader Industry Transformation
The momentum behind captives extends far beyond any single company or model. Industry trends show that captive insurance continues to grow as companies seek to address increasingly complex risk management challenges and gain greater control over their insurance programs.
This isn’t a passing trend – it’s a recognition that the old way of structuring benefits no longer serves the best interests of employers or their people. Captives are proving that transparency, efficiency, and employee-centric design aren’t just idealistic goals; they’re achievable business strategies that deliver measurable results.
Better Benefits, Total Transparency
As the benefits landscape continues to evolve, the rise of captive interest represents more than a shift in financing mechanisms. It signals a movement toward shared success, where employers and employees both benefit from structures built on transparency, trust, and aligned incentives.
The recognition from Captive Review validates what forward-thinking employers already know: that innovative approaches to employee benefits aren’t just possible; they’re essential for attracting and retaining talent in today’s competitive market.
Ready to explore how a captive model could transform your employee benefits program? The rise in captive interest isn’t just changing the insurance landscape – it’s creating new possibilities for employee protection and employer value. Contact BeneRe today to learn how our award-recognized captive model can deliver better benefits with total transparency for your organization.