A Captive Must Act Like an Insurer

November 2018

Representing business, commercial and real estate clients, as well as insurers and their policyholders

                    FEATURE ARTICLE                           

A Captive Must Act Like an Insurer

Published: ABA TIPS Committee News – Self Insurers & Risk Managers

In Avrahami v. Commissioner, U.S. Tax Ct., Aug. 21, 2017, 149 F.C. No. 7, the Avrahamis incorporated a captive insurer, Feedback Insurance Company, Ltd. Feedback elected to be treated as a domestic corporation and to be taxed as a small insurance company, IRC 831(b). After Feedback was organized, premiums deducted by the Avrahamis increased significantly. 

So you think you know the law
So You Think You Know the Law

True or False?
The term “insurance” is defined in the Internal Revenue Code.

True or False?
A “pure captive” insurer is one that insures only risks of companies related to it by ownership.

True or False?
Like any insurer, a “microcaptive” pays taxes on premium received.

True or False?
If an insured’s captive program is determined to not be insurance, nonetheless the premiums are deductible business expenses.

True or False?
A captive insurer must be able to demonstrate risk-shifting, risk-distribution, and insurance risk, and must meet “commonly accepted notions of insurance.”

FIRM NEWS

Richard Williams Recognized on the 2018 Northern California Super Lawyers List

Partner Richard Williams has been selected to the 2018 Northern California
Super Lawyers list in recognition for his work in civil litigation: defense. This marks the sixth year Mr. Williams has been named to the list.

Super Lawyers, a Thomson Reuters business, is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement.

Timothy Thornton Appointed to ABA TIPS Insurance Institute Task Force

Partner Timothy Thornton has been appointed to the American Bar Association Tort Trial & Insurance Practice Section (TIPS) Insurance Institute Task Force for the 2018-2019 bar year. The Task Force aims to be at the forefront of thought leadership and emerging issues, and provides cutting-edge, nationally recognized CLE programs, articles and activities that enhance professional development, ethics, diversity and public service. ABA TIPS serves as a source of knowledge and leadership on trial practice and critical issues of justice that involve tort and insurance law.

Erin Tenner & Michelle MacDonald Speak at National Association of Dealer Counsel Fall Conference 2018


Erin Tenner

Michelle MacDonald GD
Michelle MacDonald

Partner Erin Tenner and Associate Michelle MacDonald spoke on the panel “Sexual Harassment Law in the #MeToo Era: What Attorneys Advising Auto Dealers Need to Be Thinking About” at the National Association of Dealer Counsel (NADC) Fall Conference 2018. This session examined sexual harassment law, trends, and risks. Panelists reviewed case studies with detailed facts and video snippets; led a discussion on perceptions, biases, and stereotypes; and reviewed best practices on policies, training, investigations, and accountability (how to have fun without crossing the line). The conference was held October 7 – 9 in Chicago. 

REAL ESTATE CORNER

real estate corner
Making More Better and Less More for Real Property Owners: Achieving “Highest and Best Use” in the Sharing Economy

Published: 

Thomson Reuters Westlaw

What we are seeing across the country is “a tale of two cities.” In some communities, policymakers and regulators embrace new technology and competition. In these communities, consumers and the local economy have seen job creation and growth. Unfortunately, in some other communities, policymakers and regulators have put up roadblocks to consumer choice and competition. In these areas, the community is worse off when arbitrary barriers are placed on new entrants. Competition is stamped out, growth is stifled, and opportunities are lost. Continue reading.

ATTORNEY SPOTLIGHT

Kathryn Camerlengo
Kathryn (Katie) Camerlengo is an Associate in the firm’s Redwood City office. Her practice focuses on labor and employment matters, business owners’ liabilityprofessional liabilitypersonal injury and construction defect litigation. Katie’s work experience includes filing and opposing summary judgment motions, taking and defending depositions and handling extensive written discovery. She takes an aggressive approach toward defending clients, but also helps negotiate favorable settlements when appropriate.
 
Katie is a second generation member of the California State Bar and the San Mateo County Bar Association. She works closely with her father George Camerlengo,Gray·Duffy partner who specializes in employment matters, and with Partner Richard Williams on defense matters.
 
Katie recently achieved dismissal for a client in a trip and fall accident case. The Plaintiff, a minor, sustained a leg injury while running unaccompanied and unsupervised through a Hooters restaurant. Rick, Katie and Associate Nathan Lee defended Long Beach Wings, LLC vigorously throughout this litigation matter, aggressively engaging in discovery motions, seeking and obtaining court orders compelling the Plaintiff to provide discovery responses, and ordering the Plaintiff to pay monetary damages to Long Beach Wings, LLC.  At trial, the case was resolved in favor of Long Beach Wings, LLC after Plaintiff agreed to dismiss the case.
 
In an effort to keep clients apprised of matters critical to their business, Katie has helped author articles in industry publications, including “Medicare Set-Aside Accounts for Future Medical Expenses in Personal Injury Claims.”
 
Katie earned her J.D. from Lincoln Law School in San Jose and her B.A. from the University of California at Riverside, where she was a four-year starting scholarship athlete on their D-1 women’s soccer team.
 

When she’s not in the office, Katie loves to be outdoors and active with her two dogs. You can also find her cheering on the Golden State Warriors.

Please Note: These articles are necessarily general in nature and do not substitute for legal advice with respect to any particular case. Readers should consult with an attorney before taking any action affecting their interests.
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Please Note: These articles are necessarily general in nature and do not substitute for legal advice with respect to any particular case. Readers should consult with an attorney before taking any action affecting their interests.

Please Note: This article is necessarily general in nature and is not a substitute for legal advice with respect to any particular case. Readers should consult with an attorney before taking any action affecting their interests.