All of the following are true about captive insurers, except: A) that they are located in locations like Bermuda B) that claims-settlement often take longer C) that the parent company or companies save on overhead and profits that they would otherwise pay to third insurance companies D) that the parent company or companies are in some cases allowed to deduct their premiums from their tax liability

Question

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Captive insurers are typically located in offshore locations like Bermuda to take advantage of tax benefits and more lenient regulations. Claims settlement may not necessarily take longer with captive insurers. The main advantage of captive insurers is that the parent company or companies have control over insurance policies and save on overhead and profits that they would otherwise pay to third-party insurance companies. Additionally, the parent company or companies may be allowed to deduct their premiums from their tax liability.

All of the Following Are True About Captive Insurers, except