Product Update

Captive Domicile Summaries Updated in Risk Financing

This release of Risk Financing features updates to the summaries of captive insurance rules and regulations for the U.S. and non-U.S. domiciles found in Appendix B.

The summaries outline a number of the requirements in each of the world's captive domicile's legislation, including the following.

  • Minimum surplus and capital requirements
  • Application and regulatory examination fees for captives
  • Premium taxes on captives
  • Lines of coverage permitted
  • Reinsurance requirements
  • Investment restrictions
  • Reporting requirements
  • Requirements for local offices and/or personnel

At least 35 domiciles outside of the United States plus nearly 40 U.S. states and territories have adopted captive insurance legislation. Changes to the regulations result from the recognition of the need for improved oversight in the financial sector in general and from the ongoing competition between the domiciles for new captive insurance business. Whenever a new approach or financial mechanism starts to attract much attention in the market, regulators typically react by pushing for amendments in their own domicile's rules to allow those mechanisms, such as protected cell captives, incorporated cell captives, and captives utilized for the securitization of risks or other so-called special purpose financial captives.

Note that changes in captive regulations may be adopted between our annual updates. For this reason, contact information and Internet links to each domicile's regulatory bodies are provided, as well as references to applicable legislation for subscribers to be able to access the most up-to-date rules in force.

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