NU Online News Service, March 5, 9:30 a.m. EST
The captive insurance market in Missouri has seen explosive growth in the past year, with annual premium for captives reaching more than $1 billion for 2009--up from $123 million in 2008, according to the Department of Insurance.
The department said it licensed three new captives in 2009 and that the industry has expanded largely because of a new state law simplifying the captive formation process.
Gov. Jay Nixon signed HB577 in July of 2009, simplifying the process of moving offshore captive operations to Missouri. The omnibus insurance bill makes it easier for companies to bring their captive operations to Missouri by removing certain financial and investment restrictions and expanding organizational options for captives. The law also makes it more attractive for companies based outside Missouri to set up captive operations there, the department said.
John Rehagen, Department of Insurance, Financial Institutions and Professional Registration captive program manager, told National Underwriter that the domicile has licensed six captives since its captive legislation was passed in August 2007. The updated legislation in 2009 "got people interested again." In 2009, he said the three captives licensed consisted of an association, a pure and a special purpose captive. The smallest captive formed, he said, was a trade association, the others were a large life insurer and a large corporation.
"The new state law has worked as designed: to encourage more captive formations in Missouri," John M. Huff, director of the DIFP said in a statement. "$1 billion in premium volume shows we have a well established captive program in Missouri and that it's a priority for our department."
A captive insurance company is formed to insure some of the risks of its owner and subsidiaries, similar to self-insurance.
Mr. Rehagen, said he will attend the Captive Insurance Companies Association International Conference in Orlando, Fla., March 7-9, where he will represent Missouri in a conference breakout session with domicile regulators, March 8 at 4:30 p.m.
Companies interested in bringing captive operations to Missouri can contact Mr. Rehagen at 573-522-2563, or online.
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