Thanks to the expert testimony of Deputy Commissioner Dave Provost, this year’s captive bill passed the House and Senate and is on its way to the Governor for his signature. Unless there is a calamity, the Governor will sign it into law within the next week.
Here is a quick outline of what it will do:
- Allows non-profit protected cells can issue dividends to its owners.
- Eliminates the requirement for an attorney-in-fact bond of a reciprocal RRG in most circumstances.
- The commissioner currently can waive the three-year exam period, but with the maturity of many of Vermont’s captives, it made sense to revisit the timeframe. This section makes default exam period 5 years, but commissioner can shorten if determined to be prudent.
- Allows any type of entity recognized by the Secretary of State to be formed as a captive.
- Allows groups and agencies to either comply with current statutory investment requirements OR come up with an acceptable plan (which DFR will keep confidential). Section 3463a – valuation methodology – still applies.
- Re-writes the RRG independent director section for clarity.
- Makes NAIC statutory accounting the standard for the new affiliated reinsurance company or ARCs. Vermont didn’t need to meet accreditation standards, but wanted to avoid a repeat of the AXXX/XXX fights.
Thank you all very much, and I look forward to hearing from you!