The Texas Department of Insurance has begun accepting applications for captive insurance companies who would like to leave their current domiciles and resettle in the Lone Star State. The State is also accepting applications for captive managers.
According to Senate Bill 734, parent companies must have significant operations in Texas in order to establish a captive. Texas-based captives can only insure operational risks of affiliated companies and controlled unaffiliated business. Accepting insurance policy risks of an insurance affiliate is prohibited.
Senator John Carona, the sponsor of Texas’s captive legalisation, said: “my hope is that this legislation will encourage businesses to form captive insurance companies within the state and also provide incentive for those companies with existing captive insurance companies to re-domesticate in Texas.”
Insurance commissioner Julia Rathgeber said: “this law change will support economic development efforts in our state by allowing companies already doing business here to locate their captive insurance operations within our borders.”
Texas, captive formation, redomestication