Connecticut unveils changes to captive regulations
The State of Connecticut has made a series of changes to its existing captive insurance regulations.
The new legislation establishes a 3-year look-back and waiver of penalties on outstanding liabilities for Connecticut insureds that have not paid the non-admitted insurance premium tax and who establish a branch captive in CT or re-domicile a foreign or alien captive to CT not later than June 30, 2023 and pays all taxes and interest due and outstanding for taxable periods ending on or after July 1, 2019 but before July 1, 2022.
The changed legislation also makes technical changes regarding foreign branch captives. It also makes technical changes adding references to foreign captives.
It also revises language governing reports for alien or foreign branch captives.
In addition the changed legislation lowers capital and surplus requirements for pure captives, association captives, industrial insured captives, sponsored captives, special purpose financial captives, agency captives and branch captives but gives authority to the commissioner of insurance to impose a higher level of capital and surplus if necessary to meet policy obligations if to meet policy obligations
Finally the new legislation removes the limitation of a captive to assume reinsurance only on risks that such captive is authorised to write directly.
The effective date for the legislative changes to come into effect is the 1st of July 2022.