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A captive insurance company is a company that shares in the insured risk of its owners and is controlled by the insured participants; in this case, FSI members. So FSI members both technically own the majority of the company through B-shares (shares do not come with actual value attached to them) and reap the rewards of any annual profits (generally, future savings). Distribution of any annual profits is determined by the Captive Advisory Board. Typically, an Advisory Board decides to lower rates or keep rates stable by directing reserve funds to benefit the owner/members. 

Participation is simple. To finalize enrollment into the health program you will sign a Joinder Agreement of the Captive.

The role of the Advisory Board is to be the voice of the owner/members and to represent them on the board. The Advisory Board will receive and review annual audits and have 100% transparency into the financials of the captive. The Advisory Board will also make decisions on how to manage annual profits of the captive, such as allowing them to build and grow in a reserve fund, or to apply them to reduce or stabilize premium costs. 

A reserve fund is a fund of money that accumulates from any profits realized. Funds grow when medical costs are lower than the premiums taken in. The premiums collected from each member cover 100% of anticipated claims. Therefore, if claims are only 80% for the year, the captive would keep 20% of the premiums for a reserve fund, or other purposes, as decided by the Advisors Board.