Efficiency & Accuracy: Transforming Captive Feasibility Through Automation

June 2025

Executive Summary

The feasibility study is the cornerstone of captive insurance formation. Traditionally, this process has relied on manual effort, fragmented tools, and siloed expertise. These conditions contribute to extended timelines, higher costs, and inconsistent outcomes all of which create barriers for organisations exploring the formation of a captive.

Capvartis is changing this. By harnessing automation, advanced analytics, and domain specific workflow design, we are dramatically improving the efficiency and accuracy of captive feasibility studies. This white paper explores how automation is reducing costs, eliminating human error, and accelerating turnaround time while increasing transparency and strategic decision-making power for clients and brokers alike.

1. Introduction: The Role of Feasibility in Captive Formation

A captive insurance feasibility study evaluates whether it is financially and strategically viable for an organization to form its own insurance company. It includes:

• Risk assessment and exposure modelling

• Loss forecasting and actuarial projections

• Domicile analysis and regulatory review

• Capital and cash flow modelling

• Cost-benefit analysis and strategic recommendations

This process, while essential, is traditionally:

• Labor-intensive and manually driven

• Fragmented across actuarial, legal, and financial consultants

• Inconsistent in quality and scope

• Time-consuming (often taking weeks to months)

The need for a more scalable, consistent, and responsive solution has never been clearer — especially as interest in captives expands beyond Fortune 1000 firms into the middle market.

2. Problem: Limitations of Traditional Feasibility Studies

These pain points introduce unnecessary friction, opacity, and inefficiency into what should be a strategic and data-driven process.

3. The Capvartis Solution: Automating Feasibility with CaptiveIQ

Capvartis developed CaptiveIQ, our intelligent proprietary platform that automates and enhances the captive feasibility process. The platform replaces manual steps with streamlined workflows, integrated analytics, and dynamic reporting.

Key Components of the Automated Platform:

1.      Smart Intake & Risk Profiling 

·       Guided digital onboarding with structured data capture

·       Built-in logic for industry-specific risk inputs

2.      Automated Actuarial Modelling 

·       Loss forecasting engines powered by actuarial methods

·       Instant sensitivity analysis for limits, retention, frequency/severity assumptions

3.      Financial Projections Engine

·       Dynamic 5-year pro formas (balance sheet, income, cash flow)

·       Automatic stress testing and capital adequacy analysis

4.      Integrated Regulatory & Domicile Intelligence

·       Up-to-date domicile benchmarking and compliance checklists

·       Side-by-side comparison of jurisdictional requirements

5.      Interactive Reports & Visualisations

·       Live dashboards and downloadable feasibility reports

·       Client-facing scenario modelling tools

4. Efficiency Gains Through Automation

Reduced Time to Delivery

CaptiveIQ reduces feasibility study turnaround from 6–12 weeks to as little as 24 hours, depending on complexity and data availability. The platform automates traditionally time-intensive steps such as data synthesis, financial modelling, and document formatting.

Cost Reduction

By minimising labor and enabling a centralised workflow, Capvartis can cut feasibility costs by 30% to 60%. This makes high-quality studies viable for middle-market companies that might otherwise be priced out.

Scalability for Advisors and Domiciles

Consulting firms and domiciles can handle higher study volumes without sacrificing quality. Repetitive tasks are offloaded, enabling experts to focus on client strategy, not spreadsheets.

5. Accuracy Improvements Through Automation

Minimised Human Error

Manual processes are prone to copy paste mistakes, broken formulas, and overlooked assumptions. Automation ensures:

·       Consistent data handling

·       Validations and logic checks

·       Audit trails for transparency

Data-Driven Recommendations

CaptiveIQ’s analytics engine pulls from:

·       Historical loss databases

·       Market rate benchmarks

·       Domicile-specific rules

This ensures feasibility outputs are grounded in objective, current data rather than generalised templates.

Dynamic Scenario Analysis

·       What-if modelling is built into the platform, enabling advisors and clients to:

·       Evaluate alternate limits and retentions

·       Model aggressive vs. conservative growth assumptions

·       Visualise surplus and reserve impacts instantly

This supports strategic decision-making, not just compliance.

6. The Innovation Edge: Strategic Benefits for Clients

Democratising Captives

Automation opens the door for all firms and industry associations to explore captives with confidence and clarity. Capvartis makes the process:

• More accessible

• Less intimidating

• Tailored to sector specific needs

Transparency and Education

Clients gain insight into:

• How projections are built

• Why specific recommendations are made

• What options they have going forward

  
  

This positions the feasibility process not just as a gatekeeping step, but as a strategic roadmap.

7. Case Example (Hypothetical)

A mid-size manufacturing firm with $20M in annual insurance spend explored a single-parent captive. Traditionally, they would have faced:

• $60K+ in consulting fees

• 10-week turnaround

• A static PDF report with limited scenario options

  
  

With CaptiveIQ, they received:

• A feasibility report in hours

• Dynamic scenario options (including group captive participation)

• Dramatically reduced cost

• Interactive visualisations to present to board stakeholders

 The outcome: accelerated board approval and captive formation within days

8. Looking Ahead: Automation as an Industry Standard

 As captives continue to evolve, automation will become a foundational capability for all stakeholders:

• Advisors will scale delivery and differentiate through insights.

• Regulators will benefit from standardised and transparent documentation.

• Clients will demand digital, real-time experiences and control over data.

Capvartis is proud to lead this evolution combining technology, insurance expertise, and client-centric design to modernise the way captives are assessed and launched.

Conclusion

Automation in captive feasibility isn’t just a productivity boost it’s a strategic enabler. By reducing cost, eliminating human error, and accelerating timelines, Capvartis empowers organisations to make better-informed, faster decisions about captive insurance.

Efficient. Accurate. Scalable.

That’s the future of captive feasibility and it’s here.

Contact Us:

Capvartis

📧 info@capvartis.com

🌐 www.capvartis.com