‘Every US state will have captive law’
Monday July 18 2011 | 03:32 AM
All US state will eventually have a captive law but few will be successful commercial domiciles, predicts Vermont’s deputy commissioner for captives.
Though only 31 of 50 US states have captive laws this will soon change, said David Provost, deputy commissioner for the Vermont Captive Insurance Division.
“I think that eventually each state will have a captive insurance enabling law. A few states will succeed as viable ‘commercial’ captive domiciles, and the others will accommodate businesses that want to have their captive in their home state,” said Provost.
The recipe for a commercially successful domicile is much the same worldwide, Provost adds. However, he thinks that as competition grows, states will seek to differentiate themselves from the pack.
“So many states have essentially the same captive law - we all copied the basics from other states - that doing something different may swing a prospective captive owner to a different state.”
Thomas Stokes,managing principal of The Towner Management Group, said captives should compare potential domiciles’ legislative attitude toward captives, operating flexibility and regulatory environment, before examining costs and location to make a final decision.
Meanwhile, Ross Elliot, captive insurance director of the Utah Insurance Department, said there seems to be a growing ‘commonality’ among US domiciles.
“The US captive industry is finally getting to the stage where the needs of smaller to middle market size companies are being addressed by their local domiciles,” said Elliot.
NEWS ARCHIVE
Article compliments Captive Review
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