WCF: Regulators positive on captive evolution
The captive market in the US is continuing to evolve, according a panel discussion of regulators from various states at the third day of the recent World Captive Forum.
The discussion, which was also recorded by Business Insurance, involved Michael Arcangel, chief captive analyst at the North Carolina Department of Insurance, Sandy Bigglestone, deputy commissioner – captive insurance, Vermont Department of Financial Regulation, Steve Kinion, captive insurance director, Oklahoma Insurance Department, Gerald Gakundi, director of supervision, Bermuda Monetary Authority and David Piner, director of the captive program, Michigan Department of Insurance and Financial Services.
It was moderated by Bailey Roese, partner at Dentons Bingham Greenebaum.
The panel agreed that there is a great deal of interest in captive insurers at the moment, with Gakundi stating that he feels that feel the world is at a pivotal stage right now with risk and the cost of capital increasing at the same time, which is leading to capacity constraints around the wider spectrum of the market.
Looking at some of the individual states, Piner said that going forward his department is hoping to move some legislation that will make it easier for sponsored captives to do business in the state of Michigan as well as looking to do away with the in-state meeting requirement, as well as other changes to the current law.
Piner also said that a great deal of information tends to get shared between the regulators of different domiciles, such questions on new captives that a regulator is not familiar with. Bigglestone added that regulators often meet at captive conferences like CICA or VCIA and exchange information.
Cannabis was also discussed by the panel, as Michigan deals with cannabis-related captives. Although Vermont is, in Bigglestone’s words. ‘not there yet’, it has created a cannabis board, whilst Kinion pointed out that Oklahoma will soon be voting on if it is to become a recreational cannabis state, which might open opportunities for the captive market.
Cyber was another topic for the panel, with Gakundi saying that Bermuda had seen a sharp increase in the number of companies managing their cyber risks through a captive.