As I gain a better understanding of this business, I relate it to mine (auto finance). In my industry, we utilize a reinsurance company for add on items (like warranties). Is this common with this industry?
EXAMPLE: You establish a reinsurance company that you purchase a home warranty from, that allows you to basically self-insure your own home warranty rather than paying a 3rd party provider. It would also allow money to sit in reserve for claims as well as serve as a tax deferral product, offsetting any paper profits. Since you are an insurance company (typically set up either in Turks/Caicos or Indian Nations for preferred treatment). This reserve is then used for investment (the way insurance companies invest) and tax is only paid on the profits.
It seems to me that any taxable profits could be offset be an insurance product as described.
Amy I speaking Greek here, or is this something that exists in this space?
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