The Numbers Are In!

powerball hostCongratulations to the State of Vermont on licensing 33 new captives in the State in 2015!  The list is made up of 12 pure captives, 7 Risk Retention Groups (RRGs), 7 sponsored captives, 4 special purpose financial insurers, 2 industrial insured captives, and 1 association captive.  Growth in 2015 was up significantly from 2014 when 16 companies were licensed.  This growth is impressive especially when considering the prolonged soft market and added competition by other U.S. states.

What I thought was really impressive was that there were 11 ‘redomestications’, which is when an existing captive moves from another captive domicile to Vermont.  That is the largest number ever to occur in a single year in Vermont. The redomestications came from the following jurisdictions: South Carolina (3), Arizona (3), Bermuda (2), Cayman Islands, Nevada, and Kentucky.  This has more to do with Vermont providing a firm, fair, efficient and consistent regulatory environment than anything else.

Seven new RRGs were licensed in Vermont, bringing the active total to 89.  Vermont continues to hold a dominant market share with over 60% of all RRGs premium volume being written by Vermont companies.  Six of the 11 redomestications to Vermont were by Risk Retention Groups.  New captives were licensed in insurance, healthcare, construction, real estate, professional services, education, transportation, agriculture, retail, and other.

Besides the newly licensed captives in healthcare, notable captives in the class of 2015 include PricewaterhouseCoopers LLP; Syracuse University; Cummins, Inc.; Marubeni Corporation; Willis Management (Vermont), Ltd.; National Life Insurance Company; Wilbur-Ellis Company; Zurich Insurance Group; and 17 Universities/Colleges.

2015’s new licensees bring Vermont’s overall total licenses to 1062 with 588 active captive insurance companies. Compared to Cayman (22), Bermuda (22), South Carolina (21), Vermont’s 33 is proof there is no place like it for captives. One day we will rule the world (did I say that out loud?)…

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

Rich Smith
VCIA President

Legis-early, not Legis-late!



Most business and industry groups probably enter their state houses with a slight sense of dread. Trying to get state legislators to fully understand your particular industry, and then ask them to make changes to the state’s laws to support the industry can be a daunting task.

Here in Vermont, visiting the folks under the gold dome is actually a very rewarding experience. I went to testify this week in Vermont’s House Commerce Committee on this year’s captive bill. This is the penultimate step in a process that starts out in the fall with meetings and surveys of our members regarding changes they would like to see to Vermont’s captive statute to enhance and streamline captive regulation in the State. We then bring the list of ideas through an iterative process with Dave Provost and his team at the Department of Financial Regulation. Together, the administration and the association bring a bill to the legislature that has been thoroughly vetted, and thus makes its way straightforwardly though the chambers before getting to the Governor’s desk.

What makes Vermont unique in this instance is that the legislators all have a positive view of the captive industry in Vermont. It is wholly supported by the Governor, the regulators and all other policy makers in the State. So, when Dave Provost and I went into the Commerce Committee on Tuesday we didn’t have to make the case for the industry. We just had to review the changes we were proposing and answer very intelligent questions by a group of people who actually know what they are talking about! That doesn’t happen every day.

The bill itself makes a number of technical changes to clean-up and streamline some current statutory language and practices, including codifying governance standards for RRGs, but it also does a number of things we think will enhance Vermont as a captive domicile.  It would reduce the capital requirements for cell company structures from $500K to $250K – Vermont’s higher minimum requirement stands out when comparing and choosing domiciles. The bill would also change the structure on capital requirements for all captive companies by allowing captives to include marketable securities along with cash, trust and letters of credit.  This allows a captive to manage its liquidity needs effectively and gives Vermont an advantage in the captive field.  If you are interested in seeing an official copy of the bill with the House amendments added to the original bill and highlighted in yellow, please click here.

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

Richard Smith,
VCIA President

Vermont – Best U.S. Domicile

Vermont on sunburst BESTYou might have heard this week that Vermont won best U.S. captive domicile for 2014 at the Captive Live conference in Chicago last week. Now, of course for those of us here in Vermont who work every day with the excellent staff at the Department of Financial Regulation, or interact with the topnotch service providers, this doesn’t come as a surprise. And we humbly submit that VCIA plays a role in the success of our fair state in the world of captive insurance. However, it is always very nice to get this type of affirmation from the industry as a whole! Kudos to all of you out there working hard every day to make Vermont the best! (Free maple syrup all around!)

Congratulations also to our good friend Dan Labrie from HAI Group who was named the new chair of the National Risk Retention Association at their annual conference last week in Chicago. Good luck, Dan!

A couple of reminders: 1. VCIA’s Road Show will be in Boston on October 21st!  Please join us and invite clients or guests who would benefit from attending this free captive educational event. Information is at this link: BOSTON ROAD SHOW  2. Help shape VCIA’s 2015 Annual Conference by submitting your session ideas by Friday, October 24th!  Feel free to circulate this link to others who may be interested in submitting topics and speaking opportunities.

Submissions should be made using the following survey link:


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