Safeguard Your Success with Miramontes Capital

At Miramontes Capital, we know how challenging it can be to protect your business against risks—especially those your standard insurance just can’t cover. That’s why we work with our 831(b) specialist, Jason Vanclef, to help you create a custom safety net that fills those gaps and helps ensure your business can weather the unexpected. Below, you’ll find answers to the most common questions we hear about 831(b) captives.

An 831(b) captive is a specialized insurance company your business owns and controls. It’s designed to insure certain risks that might be excluded or underinsured by traditional policies. This structure can also offer potential tax benefits on underwriting profits—allowing you to keep more of your reserves for actual claims.

Yes, Section 831(b) is a legitimate part of the Internal Revenue Code. Properly structured and managed captives adhere to the same laws and regulations as larger, more established insurance entities. However, it’s crucial to work with professionals like Jason Vanclef—and your own legal and tax advisors—to ensure you meet all requirements.

• Ownership: With an 831(b) captive, you own the insurance company, so you have far greater control over coverage terms.

• Coverage Gaps: A captive can insure unique or hard-to-cover risks that standard policies exclude.
• Premiums & Reserves: Instead of paying premiums to a third party, those funds build reserves inside your own captive—potentially creating an additional financial asset for your company.

831(b) captives can tackle many exposures traditional carriers often ignore or underinsure, including:

• • Supply chain interruptions
  • Legal or regulatory actions
  • Cyberattacks and data breaches
  • Business interruption events
  • Brand or reputation damage

Under Section 831(b), a qualifying captive may pay no federal income tax on its underwriting profits, up to an annual limit set by the IRS. Those funds remain in your captive as a reserve for future claims. Over time, this can help build a strong financial buffer for your business. Every situation is unique, though, so consult a tax professional to understand your specific implications.

Typically, businesses with:

1. Consistent Profitability: You can afford to set aside premiums each year.

2. Identifiable Risks: You face real but often uninsured or underinsured exposures.

3. Long-Term Focus: You’re committed to building reserves to protect your company’s future.

Even if you’re not sure you qualify, speaking with our team can help you evaluate whether an 831(b) captive is right for you.

Formation times vary, but it generally takes a few weeks to a few months. We collaborate with experienced attorneys, actuaries, and tax advisors to ensure your captive is structured correctly and set up for compliance from day one.

If no claims are filed, your insurance reserves stay within the captive. Over time, these funds can become a valuable asset for your business—further strengthening your company’s balance sheet. Think of it as having a safety net you own, which can still benefit you even if the worst never happens.

Yes. If you decide a captive no longer fits your strategy or you experience major business changes, you can dissolve or exit the captive under certain conditions. Proper planning and expert guidance ensure you do so while following all legal and regulatory procedures.

If you’re curious whether an 831(b) captive is a fit for your business, schedule a consultation with Jason Vanclef at Miramontes Capital. We’ll help you analyze your current risk landscape, explore potential coverage solutions, and determine the best path for setting up and maintaining a captive insurance strategy.