Published: Apr 10, 2025

We are seeing an unprecedented hardening of the traditional P&C insurance market—the kind not witnessed in nearly 40 years. However, this time, as history repeats itself, business owners have a solution that was created due to the 1980s liability crisis - self-insurance through the 831(b) tax code, also known as micro captive insurance. 

Today, insurance is no longer the dependable tool it once was. Policy language is expanding not with added protections, but with more exclusions. From wildfire carveouts and supply chain disruption to skyrocketing deductibles and cybercrime, today’s coverage gaps are more frequent—and more financially damaging—than ever.

These gaps don’t just threaten profitability—they can disrupt entire operations.

This year, we are proud to introduce Halo Coverage, a policy created to address the most common insurance shortcomings. Designed as part of an 831(b) Plan, Halo Coverage provides a tax-deferred buffer against denied claims, deductibles, and uninsured perils that fall through the cracks of traditional insurance.

What Is Halo Coverage?

Halo Coverage is a strategic wraparound solution designed to protect a business from unexpected financial hits that fall outside of existing commercial policies. Whether it’s an uninsurable peril or a massive deductible, Halo Coverage allows businesses to use tax-deferred funds from their 831(b) Plan to respond swiftly and strategically.

Halo Coverage Highlights:

• Covers Deductibles & Self-Insured Retentions: Reduce out-of-pocket payments that disrupt cash flow.
• Fills Coverage Gaps: Backstops exclusions and denied claims in primary insurance.
• Customizable Protection: Tailored to various industries and operational models—including real estate, agriculture, manufacturing, and transportation.
• Not Excess Insurance: Works alongside existing policies, not on top of them.
• Tax-Deferred Risk Financing: Enables use of 831(b) reserves to fund unexpected losses efficiently.

Real-World Impact: 4 Case Studies

Halo Coverage isn’t just theory—it’s already protecting real businesses from costly disruptions. Here’s how:

1. Roof Replacement After Wind Damage – Multifamily Housing

When Florida-based Coastal Residential Group suffered $4.2M in roof damage after a tropical storm, their commercial policy only paid $2.8M due to ACV limits. Thanks to Halo Coverage, they recovered an additional $1M—preserving operations and avoiding financial fallout. Download Full Case Study>>

2. Deductible Relief After a Facility Fire – Manufacturing

Sterling Manufacturing faced a $250K deductible when an electrical fire caused $825K in damages. Halo Coverage covered the entire deductible, allowing them to restore operations without tapping into reserves. Download Full Case Study>>

3. Crop Insurance Supplement – Agriculture

After a devastating crop loss, Red River Farms only received 60% coverage from their MPCI policy. Halo Coverage added 30% more protection, ensuring they recovered 90% of their revenue and avoided taking on debt. Download Full Case Study>>

4. First-Dollar Loss for Liability – Trucking

A serious accident left Desert Freight Haulers responsible for the first $500K of a $1.8M liability claim. Halo Coverage paid the full amount, helping them continue operations without cash flow disruption. Download Full Case Study>>

Why Now?

Insurance is not what it used to be, with policy language expanding because of exclusions, not additions. The hardening of the P&C market has left businesses underinsured and overexposed. Halo Coverage exists to bridge the widening gap between risk and recovery.

A Strategic Addition to Any Risk Management Approach

Halo Coverage offers a forward-thinking solution for today’s risk environment. Whether evaluating options as a business owner or advising a client, this strategy provides financial flexibility and stability when traditional coverage falls short. Contact SRA today to learn more.

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