How Franchisees Use Insurance Captives to Cut Premiums

Franchise Conversations with Fexingo: Buying, Running, and Scaling Franchise Businesses · Jul 19, 2026 · 8m · transcript

Franchise owners are pooling their insurance risks to cut premiums by 15 to 25 percent — but the strategy comes with serious pitfalls. Lucas explains how a group of twenty-five 7-Eleven franchisees in Texas formed a captive insurance company in 2023, slashing their workers' comp costs by nearly a third in the first year. Luna pushes back on the risks: captives require significant upfront capital, regulatory compliance, and a long-term commitment. Together they break down the three captive models — single-parent, group, and cell captives — and walk through the math on when a franchisee…