A bill that will allow captive insurers in New Jersey passed both houses and is on its way to Gov. Chris Christie.

Bill A2360 would make New Jersey a captive insurance domicile and create a new industry in the state. The bill passed on Jan. 7 will take effect 90 days after its enactment, according to the New Jersey Captive Insurance Association (NJCIA).

The vote was 39-0 in the Senate and 74-0 in the Assembly. Assemblyman Gary Schaer, D-Passaic/Bergen/Essex, and Assemblywoman Denise Coyle, R-Morris/Somerset, are the bill's leading primary sponsors.

New Jersey's captive bill was passed on a day when several economic development bills under the theme of "Back to Work NJ" were also moved forward, NJCIA said. The bills are focused on jumpstarting the New Jersey economy and creating a friendlier business climate in the state.

"We have been in touch with the governor's office and expect him to sign it into law this month," said Gregg Sgambati, president of the NJCIA, in a statement. "The Department of Banking and Insurance is behind this legislation and is looking forward to starting up the new industry."

Mr. Sgambati told NU in an e-mail that the bill regulates captive insurance companies—which include pure captives, association captives, sponsored captives and industrial insured captives.

"We do not have any data on which to base a prediction of the size of companies; however, my guess is that larger captives will form, from an intuitive look at the business demographics in the region," he said.

Mr. Sgambati said that New Jersey's location in the heart of the nation's financial corridor (Boston to Washington, DC) makes it geographically convenient to many large firms. Whereas parent companies previously may have elected to set up their captive insurance companies in jurisdictions that had prominent tourism industries, today companies prefer a geographically convenient domicile, he said.