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Reinsurance companies are small Property and Causality insurance companies. ”Small property and casualty insurance companies with less than $1,200,000 in annual net premiums may elect to be taxed only on investment income under Internal Revenue Code 831 (b).” Distributions are taxed at the prevailing dividend rate. These corporations, unlike “S corporations” or Limited Liability Corporations (LLC) where income flows through to the shareholders annually, are “C corporations”. 831(b) C corporations allow the shareholder a long term approach. If a distribution is not desirable, the earned premium can be retained in the reinsurance company. Earned premium reserves should and can be invested in a wide variety options; secured loans, real estate, stocks, bonds or other securities are a few.