North Carolina has introduced a new bill aimed at attracting redomestications of captive insurance companies back to the state through a "premium tax holiday".
This provision would temporarily exempt existing foreign and alien captive insurers from premium taxes - if those captives are approved by the North Carolina Department of Insurance to redomesticate to North Carolina by December 31, 2020.
House Bill 220 was introduced on February 28 by the co-chairs of the House Insurance Committee, representatives Dana Bumgardner Gaston, Kevin Corbin and Mitchell Setzer.
“This provision is yet another benefit for captive insurance companies to domesticate in North Carolina versus other jurisdictions onshore or offshore,” said insurance commissioner Mike Causey. “In addition, this proposal would bring future tax revenue to the state, as foreign and alien captive insurers do not currently pay any premium taxes in North Carolina.”
The bill was worked on by the NC Captive Insurance Association (NCCIA) and the NC Department of Insurance for the past 6-8 months to develop technical corrections and the centerpiece of the bill, the premium tax holiday.
Thomas Adams, president & CEO of NCCIA, added: “Our members are excited about the potential for additional growth of the number of captives in the domicile, particularly as more companies see the significant benefit of these changes.”
The bill also introduces an exemption from the annual audit requirement for captive insurers amended to the wording contained in a similar exemption for traditional insurers. It clarifies that the NCDOI’s internal financial analysis workpapers are confidential.
Furthermore, it provides an amendment to require special purpose captive insurers with a cell or series structure to pay the same tax as that imposed on protected cell captive insurers.
North Carolina, NCCIA, NCDOI, Tom Adams, North America