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Governor Kasich has signed legislation allowing Ohio businesses to form captive insurance companies in the state to provide for their own commercial insurance needs.
Lieutenant governor and Department of Insurance director Mary Taylor announced the signing of House Bill 117, which provides the department with full regulatory authority over captives.
Ohio now joins more than 30 states that allow the formation of captives.
“Thanks to the work and leadership of chairman Hackett and rep. Stinziano in conjunction with many different stakeholder partners, this legislation will further strengthen Ohio’s insurance market.” Taylor says. “These new tools will offer Ohio businesses new opportunities while also ensuring the department has the proper and appropriate oversight in place.”
The legislation allows the formation of captives to meet the commercial insurance needs of businesses, for product lines such as commercial auto liability, workers’ compensation and medical malpractice. The legislation does not permit captives to be used to insure personal lines of insurance.
HB 117 also sets forth certain capital and financial reserve, organizational, general application and fee requirements and gives the department authority to monitor the relationship/transaction between a parent business and its Ohio formed captive(s) instead of relying exclusively on another state’s regulator.
These measures will provide the department with the regulatory tools necessary to monitor and regulate captives operating in Ohio.
Ohio, captive insurance, HB 117, Governor Kasich