Product Update

831(b) Captive Discussion Updated in Risk Financing


Single-parent captives with gross premium revenues up to the amount permitted may make an election under Internal Revenue Code 831(b). An 831(b) captive is taxed solely on its investment income. The premium income is exempt from federal income tax. Otherwise, it is treated no differently from any other type of captive. In 2017, the threshold on the total annual premium for an 831(b) captive was increased from $1.2 million to $2.2 million.

This Risk Financing release revises the discussion on captive insurance to reflect the recent changes to regulations for micro or 831(b) captives.

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