The landscape of the business world is changing; and now, more than ever, business owners are recognizing that life is filled with risks: known risk, calculated risk, and unexpected risk. Every day, businesses thrive or fail based on understanding the risk of owning and operating their business, and business owners are recognizing that there are alternative risk financing mechanisms other than simply taking out a basket of standard coverage as recommended by your friendly neighborhood agent. A captive insurance company is an insurance company established to provide a broad range of risk management capabilities to affiliated companies. The captive is owned by the business owner and can provide insurance to the business for potential future losses, whether or not the losses are already covered by a commercial carrier or are "self-insured." The premiums paid by your business are tax deductible. Meanwhile, the premiums that your captive collects are tax-free up to $1.2 million annually.