Give Peace (Church) a Chance

 

boatsMy thanks to Phil Leaman and his board of directors at Peace Church Risk Retention Group (a reciprocal) for inviting me to join them for their meeting in Vermont last week. Phil is COO of Peace Church RRG, and spoke at VCIA’s recent Road Show in Philly.  Peace Church is part of a larger umbrella organization that provides services to approximately 140 organizations with programs for aging, disability and behavioral health.  Phil is also an active member of VCIA’s Legislative Committee and participates first hand in VCIA’s legislative and regulatory efforts.

I was on the panel with two absolute pros from Vermont’s Department of Financial Regulation captive insurance examination office, Dan Petterson and Heidi Rabtoy. We gave an overview of DFR’s regulatory regime, VCIA’s activities on behalf of our members, and how both organizations work cooperatively for the industry.  What a great opportunity for the State and VCIA to get directly in front of a captive board to report on our activities and take their questions! I think they left with an even better feeling of being domiciled in Vermont and being a member of VCIA than when they arrived – at least I know I did!

In speaking with Dan and Heidi afterward (and Deputy Commissioner Dave Provost), we all agreed we would welcome other opportunities to get before captive boards of directors.  So, keep us in mind for your next captive board meeting in Vermont. Having us there makes Vermont look good and can make you look good, too!

On another note, thanks to everyone who came out Wednesday afternoon and evening for VCIA’s Board Meeting and Annual Spring Mixer. The evening on the deck of the Burlington Sailing Center overlooking Lake Champlain was absolutely gorgeous. Add in good food and drink, and great friends, and it was a super event! Thank you to Johnson Lambert LLP for sponsoring the mixer.

 

Thank you all very much, and I look forward to hearing from you!

Rich Smith
VCIA President

At RIMS in Beantown

RIMS2B

I am down at the giant RIMS convention in my hometown – Boston – right now. There is a large contingent of Vermonters down here all being herded by Ian Davis, Vermont’s Director of Financial Services.

Our goal is to have Vermont stand out in a field of 10,000 plus attendees at this conference. Vermont brings down their “super” booth which draws a crowd every year for those who want to learn more about our innovative industry, to those who just want to come over and say “hi”. Janice Valgoi and I with a number of our members hold our own against the huge presence of many international insurance companies, brokers and service providers.

And sure, Bermuda gives out their bags every year (how many Bermuda bags can one own!), nothing beats Vermont maple syrup and the ice cream social we host every day. So, if you are at RIMS, please come by and say hello!

And speaking of conferences, online registration for the VCIA 2019 Annual Conference opens tomorrow! Some fantastic new features are in the works for this year including “Captive Immersion”, “Learning Circles”, an outing to Burton Snowboards for captive owners, and a longer exhibitor reception with samplings of Vermont spirits throughout the hall. We have two excellent keynote speakers; one is even an astronaut! It’s going to be a fantastic event. Check it all out at www.vcia.com and let me know what you think!

Thank you all very much, and I look forward to hearing from you.

Rich Smith
VCIA President

Lights, Camera, Act(ion)!

bill signing blog

Governor Phil Scott signs Vermont’s updated captive bill on April 18, 2019. Behind him from left to right are Ben Gould (Paul Frank + Collins), Ian Davis (State of Vermont Department of Economic Development) and Mike Marcotte (Chair of the House Commerce Committee)

As I mentioned in my blog a couple of weeks ago, the Vermont legislature passed this year’s captive bill pretty quickly and all we were waiting for was the Governor’s signature to make it officially
an Act.

Yesterday, at the Governor’s ceremonial office in the State House, Governor Scott did just that! Surrounded by VCIA members the Governor signed this year’s captive bill into law strengthening Vermont’s captive regulation in a variety of areas. This year’s bill proposed several updates, including modifications to the captive examination schedule and improvements to the statute governing group captive investments. The enhancements included in this year’s bill highlight the state’s ability to work closely in partnership with Vermont’s Governor and state legislature to ensure its captive law remains the industry gold standard.

Along with State officials, those participating included VCIA legislative chair Ben Gould of Paul Frank + Collins, John James from Performa, Mat Robitaille and Connor Duffy from KeyBank, Steve Killoran and Rich Litchfield from Maple Capital,
Michelle Ambrose and Linda Elliott of Marsh, and Christina Kindstedt
from Advantage Insurance Management.

Thank you all very much, and I look forward to hearing from you

Rich Smith
VCIA President

 

The Gospel of Captives and Temple

students

As I mentioned in my last blog, we were in Philadelphia last Tuesday for one of VCIA’s famous Road Shows serving up our sermon on the gospel of captives to a group of around 100 attendees. My heartfelt thanks to all the participants and our sponsors: Trion-MMA, Old Republic PMA, Kroll, and the State of Vermont.

Jeff Packard of Old Republic PMA acted as our MC, introducing the panels while providing entertaining (and educational) anecdotes of his many years in the captive industry. Our panelists were terrific as well! Kirk Watkins, Captive Practice Leader of Trion-MMA, walked through the basics of captives including types, lines and the process of setting one up. Then Ian Davis, Director of Finance, and Sandy Bigglestone, Director of Captives, provided an overview on regulation and licensing of captive insurance in the State of Vermont.

The second panel included two of Vermont’s captive insurance owners, Gary Langsdale, University Risk Officer for The Pennsylvania State University which owns Nittany Insurance Company, and Phil Leaman, COO of Resource Partners and Peace Church Risk Retention Group (A Reciprocal). Both provided excellent information from their many years of experience in operating captive insurance companies.

Gary outlined the complexity of his captive which covers 8 million sq. ft. of floor surface in 700 buildings, a 107,000-seat football stadium, 45,000 students, 16,000 faculty and staff, 1900 owned motor vehicles, two large hotel and conference centers, and, my favorite, a nuclear reactor sharing a driveway with the child care center!  Phil talked about how his captive covers Quaker, Mennonite, and Church of the Brethren facilities serving the aged and other assisted living populations.  With approximately 140 organizations and 16,843 insured units, Peace Church has gross written premiums of $55,433,689.

But most of all, we had around 30 students from Temple’s Fox School of Business studying risk management or actuarial sciences who joined us that afternoon. This extremely poised, intelligent group of young adults asked the best questions and provided all of us great hope for the future of the captive industry. My sincere thanks to Michael Zuckerman, Assistant Professor at the Fox School of Business and Management’s Dept. of Risk, Insurance and Healthcare Management, for bringing such an inspiring group of students!

Thank you very much, and I look forward to hearing from you!

Rich Smith
VCIA President

Congratulations Sandy & Ian!

sandyandIan2018Two of Vermont’s best in the captive industry have just been recently honored.

Sandy Bigglestone, Director of Captive Insurance for Vermont’s Department of Financial Regulation, has been named to the Business Insurance 2018 Women to Watch, that recognizes 30 women leaders doing outstanding work in risk management and commercial insurance worldwide.  Business Insurance readers nominated candidates for Women to Watch, and a panel of Business Insurance editors selected the honorees based on those nominations.  Also recognized in this list is Ellen Charnley of Marsh Captive Solutions. Sandy not only does outstanding work for the State of Vermont, but she has become a true leader in the captive insurance industry – someone who is sought out for her advice and her expertise on panels and forums across the country. And she does it all with a great sense of humor and aplomb!

Ian Davis took the reins at Vermont’s Department of Economic Development as Director of Finance only a short time ago and he has already made a name for himself. He quickly became the go-to guy for Vermont in its continuing conquest of the captive insurance world. Vermont Business Magazine named Ian to their 2018 Class of Rising Stars. Award recipients were selected by a panel of judges for their commitment to business growth, professional excellence and involvement in their communities. I couldn’t agree more!

Just two more reasons Vermont is the BEST place for captive insurance. Congratulations Sandy and Ian!

Thank you and I look forward to hearing from you!

Rich Smith
VCIA President

VCIA Spring Fling – Thank you Johnson Lambert!

 

2018-spring-mixer

It was a beautiful evening in Burlington, Vermont for the VCIA Spring Mixer! From left to right: Christine Brown and Sandy Bigglestone from the Vermont Department of Financial Regulation, VCIA Board Chair Jan Klodowski and Dawne Ware from Marcum LLP

One of my favorite VCIA events of the year is our annual Spring Mixer in Burlington, where 100 or so of our members join us for a little education, a little networking and a lot of fun! This year’s event on May 16 was no exception.

At the VCIA Board of Directors open meeting, an overview of the upcoming VCIA Annual Conference was presented to members. The conference, taking place August 7 – 9, is our 33rd annual conference and the theme is “VCIA: Where the Captive World Comes to Meet!” This is an apt description of our annual event, which highlights the power of collaboration among people from all sectors of the captive industry.  This year, special focus has been placed on professional development as well, with sessions such as Presenting to Board/Management, Building Better Relationships and a new young professionals forum.

Ian Davis, Director of Financial Services for the State of Vermont, then gave an update on the State’s captive insurance activities, including the fact that Vermont has already licensed 11 new captives in 2018 with more in the pipeline. Dave Provost, Sandy Bigglestone and Christine Brown from Vermont’s Department of Financial Regulation (DFR) gave a report on their ever attentive zeal on making the regulatory process for captives in Vermont efficient and cost effective.  Dave also announced the Governor signing the DFR bill this week, which includes a change to the captive statute that will offer an onshore affiliated reinsurance alternative to insurance companies affected by the recent imposition of the Base Erosion Anti-Abuse Tax on reinsurance ceded to offshore affiliates. An affiliated reinsurance company is an insurance or reinsurance company that reinsures risks only from its parent or affiliates, and is subject to a financial solvency regulatory system separate from that generally applicable to traditional insurers and/or reinsurers in the ceding entity’s domestic jurisdiction.

And finally, the part of the day we all wait for (and deserve!): the cocktail mixer under beautiful blue skies on the patio of the Hotel Vermont/Marriott Courtyard. Our thanks to our great friends at Johnson Lambert for sponsoring this wonderful event!  Not only do our Vermont members show up en masse, but friends from New York, Connecticut and even South Carolina joined us for a great evening of friendship and comraderie.

We look forward to seeing you in Vermont in August. Thank you all very much!

Rich Smith
VCIA President

I Kind of Like the Swamp…

rich-swamp-2I am down in Washington for a couple of days meeting with various Congressional staff people about moving the Captive Clarity Bill forward, slowly but surely.

The Captive Clarity Bill is seeking to clarify (hence the name!) an issue passed in legislation a number of years ago.  Within the Dodd-Frank Act was passed the Nonadmitted and Reinsurance Reform Act (NRRA), which was intended to streamline the regulation and taxation of surplus lines insurance. However, some of the definitions in the Act are so broad that questions have been raised about its effect on captive insurance. If captive insurance is considered “nonadmitted insurance” under the NRRA, captive insureds may be required to pay a premium tax to their home state in addition to their captives paying domiciliary state premium taxes, and be partially regulated by the insured’s “home state.”

Currently, captives are taxed and regulated in the state that they are domiciled regardless of where their corporate owners’ headquarters may be located. Under NRRA, the home state could assert the right to tax the self-procured insurance premiums written within the captive entity even though the state of domicile already charges the captive a premium tax.  It would suddenly penalize many companies by double taxing them for being domiciled in a state that is not their home state.  Although the Act does not give states any additional taxing authority, the prospect of nondomiciliary states accessing additional insurance transactions to tax has increased the risk of states attempting to impose new taxes on captive insurance. On the other side of that coin, domiciliary states may be at risk of losing their ability to collect premium taxes and regulate certain aspects of captive insurance.

Ian Davis, Director of Financial Services for the State of Vermont, and I will be meeting with our Vermont contingent, Patrick Satalin with Rep. Welch (D-VT), and Erica Chabot and JP Dowd with Senator Leahy’s Office. We will also be meeting with key Congressional staffers, including John Hair with Rep. Sean Duffy (R-WI) – Chairman of the Housing and Insurance Subcommittee, Saat Altey with Senator Tim Scott (R-SC) – Member of the Senate Banking and Insurance Subcommittee, Brandon Beall, Professional Staff for Insurance, Senate Banking Committee, and Amanda Fischer, Director of the Democrat/Minority Policy for the House Financial Services Committee. Finally, I will be meeting with Richard Ifft in the Federal Insurance Office at the Treasury Department. Phew… I need a break just looking at the list!

Jim McIntyre and I will be providing a full legislative report during the VCIA Annual Conference to VCIA Members attending the  Annual Meeting, so come on by and find out more!

We look forward to seeing you in Vermont in August. Thank you all very much, and I look forward to hearing from you soon.

Rich Smith
VCIA President