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The State of Montana has introduced a revised captive insurance bill that could allow inactive captives to apply for dormant status.
Senate bill no 245 has added a section that defines a dormant captive insurer as a captive insurance company that has ceased transacting the business of insurance, including the issuance of insurance policies, and that has no remaining liabilities associated with insurance business transactions or insurance policies issued prior to the filing of its application for a certificate of dormancy.
The bill states that a captive insurance company domiciled in Montana that meets this criteria may apply to the commissioner for a certificate of dormancy.
Any certificate of dormancy is subject to expiration at the end of a consecutive 5-year period and may not be renewed.
The bill laid out several terms for a captive with a certificate of dormancy, stating that it shall “possess and thereafter maintain unimpaired, paid-in capital and surplus of not less than $25,000.”
Within 90 days of each fiscal year end, the dormant captive must also submit to the commissioner a report of its financial condition, verified by oath of two of its executive officers, in a form as may be prescribed by the commissioner.
The dormant captive must also pay $1,000 annual dormancy tax due on or before March 1 of each year.
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Montana, Captives, Insurance, Legislation, North America