The State of Vermont licensed 22 new captive insurance companies in 2019, according to data released by the Vermont Department of Economic Development, and expects another busy year in 2020.
The new licenses included 14 pure captives, four sponsored captives, two risk retention groups (RRGs), one special purpose financial insurer and one industrial insured captive. They were licensed in healthcare, real estate, manufacturing, insurance, transportation, technology, construction and professional services, with six redomestications from other jurisdictions: three from New York, two from Bermuda and one from Switzerland.
New and notable companies include Massachusetts Mutual Life Insurance Company, KPMG, University of Vermont Health Network, Stamford Health, RELX, and Fortive Corporation.
Ian Davis, director of Financial Services in Vermont’s department of economic development, said licensing activity in 2019 reflects the changing insurance environment. “We licensed nine new captives in the fourth quarter alone and, given the hardening market, we expect the momentum to continue on into 2020.”
“There continues to be growing interest in sponsored captive programs from small and mid-sized companies,” added Dave Provost, deputy commissioner of captive insurance.
Vermont is now home to 585 captives, consisting of 559 active and 26 dormant captive insurance companies. It is now home to 37 cell facilities, housing over 200 cells. The state has licensed a total of 1,159 captive insurance companies since 1981 and remains the largest US domicile for captive insurance, and the third largest domicile in the world.
Vermont Governor Phil Scott emphasised the role captive insurance plays growing the state’s economy. “We remain committed to Vermont’s gold standard reputation as a captive domicile,” he said.
Sandy Bigglestone, director of captive insurance, said sponsored companies provide an efficient alternative solution for many businesses. “It is very common for one cell owner to move from a sponsored company to its own pure captive insurance company, demonstrating that protected cells can offer space to incubate the owner’s need to have greater control over its insurance operations,” said Bigglestone.
Vermont Department of Economic Development, Ian Davis, Dave Provost, Sandy Bigglestone, Phil Scott