MONTPELIER, Vt., Jan. 13, 2020 /PRNewswire-PRWeb/ -- The State of Vermont licensed 22 new captive insurance companies in 2019, according to data released by the Vermont Department of Economic Development. The new licenses were made up of 14 pure captives, four sponsored captives, two risk retention groups (RRGs), one special purpose financial insurer and one industrial insured captive. Following a year of continued growth, Vermont is now home to 585 captives, consisting of 559 active and 26 dormant captive insurance companies.
"It's great to see another strong year of growth for Vermont's captive insurance industry," said Governor Scott. "Captive insurance plays an important role in our efforts to grow the economy and make our state more affordable and we remain committed to Vermont's gold standard reputation as a captive domicile."
The new captives were licensed in healthcare, real estate, manufacturing, insurance, transportation, technology, construction and professional services. New and notable companies include Massachusetts Mutual Life Insurance Company, KPMG LLP, University of Vermont Health Network Inc., Stamford Health, RELX Inc., and Fortive Corporation. Six of Vermont's 22 new captives were redomestications from other jurisdictions—including New York (3), Bermuda (2) and Switzerland (1).
"Vermont's 2019 licensing activity in many ways reflected the changing insurance environment," said Ian Davis, Director of Financial Services. "We licensed nine new captives in the fourth quarter alone and, given the hardening market, we expect the momentum to continue on into 2020."
"As we have seen over the last few years, there continues to be growing interest in sponsored captive programs from small and mid-sized companies," said Dave Provost, Deputy Commissioner of Captive Insurance. "When you factor in the four new sponsored captives, Vermont is now home to 37 cell facilities housing well over 200 cells, and the concept is only becoming more popular."
"Sponsored companies provide an efficient alternative solution for many businesses," added Sandy Bigglestone, Director of Captive Insurance. "Additionally, 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."
"Vermont's world-class regulatory framework and service provider network continues to be key determinants in attracting new business to the state," said Rich Smith, President of the Vermont Captive Insurance Association (VCIA). "The stability, knowledge and experience of Vermont's captive industry is simply unmatched."
Vermont has licensed a total of 1,159 captive insurance companies since 1981 and remains, by far, the largest U.S. domicile for captive insurance and third largest in the world. With an active pipeline of prospective new captive insurance companies already underway for 2020, the state expects continued growth in the coming year.
Captive insurance is a regulated form of self-insurance that has existed since the 1960s and has been a part of the Vermont insurance industry since 1981 when Vermont passed the Special Insurer Act. Captive insurance companies are formed by companies or groups of companies as a form of alternative insurance to better manage their own risk. Captives are commonly used for corporate lines of insurance such as property, general liability, products liability, or professional liability.
For more information on Vermont's captive insurance industry, visit http://www.vermontcaptive.com, call Ian Davis at 802-828-5232 or email [email protected].
The Department of Economic Development operates within the Agency of Commerce and Community Development, whose mission is to help Vermonters improve their quality of life and build strong communities.
SOURCE State of Vermont
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