A healthcare organization with 10,000 employees wanted to implement captive funding for some of their employee benefits without too much change or impact on their current processes.


The organization wanted to expand the use of their existing Vermont captive insurance company to fund long term disability and group life/AD&D coverage in an effort to reduce overall cost of risk and enhance cash flow to the company. Additional objectives included improving operational performance of their benefits programs through integration of coverage from both a funding and process perspective and build up captives assets for a better return on investment. The client wanted to use their existing carrier partners and minimize any impact on human resources. As a result, potential solutions needed to consider the impact on existing carrier relationships, renewal dates and employee processes, and also acknowledge that the human resources department had a number of program initiatives underway.


Spring conducted a high level feasibility study to determine if the objectives could be met. Working closely with human resources and risk management, we helped structure the program from gaining Department of Labor and captive domicile approval to implementation. We were able to implement the new structure with existing carriers within a six month time frame.

Spring’s Solutions

After determining that funding long term disability and group life coverage in a captive would meet their objectives, we transitioned the existing carriers from fully insured to captive fronted contracts and confirmed the claims and operational process for human resources and employees did not change. Additionally, we negotiated program savings that could eventually be passed on to employees leading to a savings in the HR budget and created financial reports to better manage the program.


The resulting savings were over $7 million in the first year. The organization was able to maintain the same operational and claims processes for human resources and employees, but with improved information flow resulting from the newly introduced enhanced reporting formats.