“Steady and sustained growth,” is how Vermont officials described 2006’s final tally for captive insurance as 37 new captive insurance entities were licensed. New to the nation’s largest captive insurer domicile, include such well-known companies as Starbucks Corp., McGraw-Hill, Principal Financial Group, Ameren and Aegon.
According to the Vermont Department of Banking, Insurance, Securities and Health Care Administration (BISHCA) the 37 new captive insurance companies licensed last year equals the number of new captives licensed in 2005. The total number of captive licenses issued in Vermont is now 791, making it the largest captive domicile in the United States and the third largest in the world.
The new captives formed include 25 pure captives, five sponsored, three new risk retention groups, three association captives, and one industrial insured captive.
Some of the growth is coming from the life insurance and benefits sectors.
“We are seeing an emerging trend in the expanded interest in Vermont by the so-called ‘Triple X’ securitization captives and by employee benefits,” said Derick White, director of Captive Insurance. “These ‘Triple X’ captive facilities are providing a way for life insurers to form reinsurance captives.”
Vermont has currently licensed five such programs, with more on the horizon. The year 2006 also saw the licensing of five new employee benefits captives writing both ERISA and non-ERISA benefits. Another trend that has emerged is the continued growth in health care facility captives.
“Vermont now has nearly 100 programs writing over $1.4 billion in premiums in medical malpractice coverage,” said Dan Towle, director of Financial Services. “I think it’s fair to say that we’ll continue to see strong activity in 2007.”
Source: Vermont Insurance Department
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