In less than a year since its captive-enabling legislation went into effect, North Carolina says it is making progress towards its goal of becoming a leading captive domicile.
To date, the North Carolina Department of Insurance said it has licensed 12 captives, including five protected cell captive insurance companies that have multiple cells, and more than 16 license applications are currently under review.
NCDOI experts estimate that North Carolina will have licensed more than 40 captives and the captive insurance program will have favorably impacted North Carolina’s economy by approximately $2 million by the end of 2014.
Debbie Walker was named captive director in January.
“North Carolina’s captive insurance program is off to strong start, but more importantly, we are dedicated to the long-term success of the captive insurance program,” said N.C. Insurance Commissioner Wayne Goodwin at the first annual conference of the North Carolina Captive Insurance Association in August.
Thirty states now have laws permitting captives.
“We started out with what I believe is a truly state-of-the-art captive insurance law that provides a sensible pro-business approach to captive regulation. And we continue to review and improve our legislation to be responsive to the needs of captive insurers,” Goodwin said.
In the past six months, according to NCDOI, the following developments have occurred:
- Atlas Insurance Management, a North Carolina resident captive manager, which manages the first three captives formed in North Carolina, is managing three other North Carolina captives that are new captive formations or redomestications.
- Captive Insurance Group, LLC, an approved captive manager, manages a newly-formed protected cell captive that currently holds nine protected cells.
- Management Services International, Inc. (“MSI”), an approved captive manager, is managing a pure captive that redomesticated to North Carolina.
- USA Risk Group (South), Inc., a North Carolina resident captive manager, is managing a protected cell captive insurer that redomesticated to North Carolina from another on-shore jurisdiction.
- Willis Global Captive Practice, an approved captive manager, is managing a newly-formed protected cell captive insurance company.
- Beecher Carlson Insurance Services, LLC and Synergy Captive Strategies, LLC, both approved captive managers, continue to manage captives that were formed previously.
Sixteen captive redomestication applications submitted by captives that are managed by MSI are currently under review by the Department. These applicants intend to redomesticate to North Carolina by Sept. 30, 2014. Upon approval of the redomestication of these captives, MSI will become one of the largest captive managers within North Carolina, and the number of North Carolina captives will increase to at least 28.
Captive insurance is typically a form of self-insurance in which an insurance company is formed to insure the risks of the parent company and its affiliates. Captives create jobs for those who form and perform services for the captive, and they generate premium tax revenues for the state or jurisdiction in which they are established.
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