Kentucky banks with over $450 million in assets will have the opportunity to form their own captive insurance company to cover risks that are not currently commercially insured and enhanced the enterprise risk profile of their bank through KeyState's Bank Captive Program. If properly structured, the captive can provide a bank with over $380,000 in annual tax benefit.* the captive insurance company is implemented by Crowe Horwath LLP, a national accounting firm, and then managed on an ongoing basis by KeyState Captive Management.
“The program is already a proven success,” explained Chuck Maggard, KenBanc Insurance Services President & CEO. “Over 75 percent of Indiana’s eligible banks have already formed their own captive insurance company since the Bank Captive program was introduced by KeyState, less than two years ago.”
“The benefits are so compelling, which is why the KBA agreed to endorsed KeyState’s Bank Captive Program and make the captive available to it’s members,” added Maggard.
“Implementing the captive caused our bank to look deeper into our commercial insurance program and the wider range of risks that we face as an institution. Of course, I’m pleased with the positive impact to consolidate earnings, but I’m also glad that we now have a formal process in place for an independent review of our insurance program,” explained Greg Dawson, SVP & CFO, Kentucky Bank (Paris, KY).
*Potential savings is an after-expense estimate and will differ based on a bank holding company’s tax rate, premiums paid to, and claims paid by the captive in a given year.