The Connecticut Insurance Department has licensed a captive that specialises in consultation and financial management for reinsurers.
The captive, which is a subsidiary of New Jersey-based SOBC Corporation, is the state’s eighth captive insurer.
It is also the first ‘sponsored captive’ company since legislation cleared the way for the state to begin licensing these specialty insurers in 2011.
“A sponsored captive’s client is not the parent company but rather can be one or more entities that use segregated accounts or ‘cells’ set up by the sponsor to finance each client’s risk,” said the department.
The SOBC captive will provide risk financing, management and claims services for portfolio transfers of small books of business currently exiting the market.
Katharine Wade, Connecticut Insurance Commissioner, said: “A business plan for a successful applicant is one that must be prudently-managed, well-capitalised and rooted in sustainability.
“These are not short-term entities but must be committed to meeting the long-term obligations of their clients and ultimately provide another tool for businesses and employers to control their costs.”
Brian Johnston, president of SOBC, said: “We are very excited to be the first ‘sponsored captive’ licensed in Connecticut. Our experience with this well-regulated state has been excellent.
“John Thomson and his team at the Insurance Department have been extremely responsive to our unique business plan. Our new Connecticut platform gives us the ability to segregate the portfolios of acquired assets, which is a significant advantage for our business and our clients.”
Connecticut Insurance Department, SOBC, North America, Katharine Wade