North Carolina Enters Captive Insurance Arena, While Maryland May Pass
The purpose of North Carolina House Bill 473, which was signed into law on June 19, 2013, was to “establish the procedures for the organization and regulation of the operations of captive insurance companies transacting insurance business within [North Carolina] and thereby promote the general welfare of the people of [North Carolina].” Since the state’s Captive Insurance Act actually took effect in October 2013, the North Carolina Department of Insurance (“NCDOI”) has issued four captive insurance company licenses as follows: West & Joyce Insurance Company (issued December 30, 2013); Cade Reassurance, LLC (issued December 31, 2013); SR Insurance, LLC (issued December 31, 2013); and Synergy Insurance, Inc. (issued December 31, 2013). In January 2014, the NCDOI also named Debbie Walker as its Director of Captive Insurance. Walker stated that it is her goal and the goal of the NCDOI “to make North Carolina a respected and leading captive domicile.”
Meanwhile, Section 1, Chapter 407, 2013 Laws of Maryland – which was also signed into Law in June 2013 – required the Maryland Insurance Administration (“MIA”) to examine methods of establishing and regulating captives within the State and to make a recommendation whether Maryland should establish a captive insurance industry in the first instance. The MIA issued a report in December 2013, finding that “there is no evidence to support a conclusion that becoming a captive domicile would create actual economic benefit to Maryland.” Accordingly, it recommended “that the General Assembly forego captive legislation at this time.”
Click here to read the Maryland Insurance Administration’s December 2013 report.