Captive Madness

NCAA Forms a Captive— in Vermont!

Many Vermonters in the captive industry might have had an NCAA bracket that had UVM going all the way. Locals supporting locals is what we do here. Sadly, Arkansas stood in their way, and UVM came up a little short in the first round. They didn’t bust the nation’s brackets, but there were other perpetrators—I’m looking at you, Saint Peters Peacocks. The absence of the Catamounts from the Final Four makes it no less intriguing, but you might wonder, where’s the link with VCIA and captive insurance?

The Vermont Captive Insurance Industry is a Powerhouse Program

The answer lies in the fact that the NCAA, perhaps mindful of the hit that their marquee event took in 2020 and 2021, recently formed a captive, and not only that, but they have made its domicile in the Green Mountain State. Vermont’s most popular (and free) newspaper, Seven Days reports that the captive activated at the start of March and could “potentially save the association millions of dollars.” Taking on both D & O and event cancellation coverage, the entity has been funded with $175M, and will be consolidated into the financial statements of the NCAA.

The pandemic has raised the profile of Vermont’s captive insurance industry as more businesses have sought to self-insure, according to state officials.

ANNE WALLACE ALLEN, Seven Days

While the University of Vermont will not be crowned winners after this upcoming Monday’s championship, the State of Vermont surely won an impactful and lasting relationship with the National Collegiate Athletic Association. VCIA is happy to announce that their captive formation has joined our association on a free, first year trial basis.

My prediction for the Final Four winner (which is the sporting equivalent of a kiss of death)? Kansas Jayhawks. Who do you have?

A Busy and Productive Week with VCIA

Captive Roadshow and Hot Topic Webinar Major Successes on Back-to-Back Days

2022 brings a wealth of enthusiasm and optimism not only for VCIA but for the entire captive industry. The major cause of this excitement derives from the simple fact that we are all getting together again. Catching up. Building out networks. Collaborating on new ideas. The possibilities are endless when we’re all in the same room. (Which is why we’re so thrilled to bring back our conference this August!)

It’s no small feat then, that this week VCIA’s returned with its first in-person Original Captive Roadshow since November 2019!  In Indianapolis on Tuesday an audience of over sixty professionals listened intently and asked great questions as a panel of Vermont industry experts (Sandy Bigglestone, Dave Provost, Brittany Nevins) enjoyed a captive conversation facilitated by Hylant’s Anne Marie Towle. The Vermont team outlined the process and structures of captives in Vermont and why captives can thrive in the Green Mountain State.

2022 brings a wealth of enthusiasm and optimism not only for VCIA but for the entire captive industry. The major cause of this excitement derives from the simple fact that we are all getting together again.

Following that, two captive owners Valynda Laird and Will Lehman explained their business case and development of their own entities that have done so well due to captive formation.  The feedback was very positive and we are already deep in planning for the next two. The Big Apple just might be seeing our Roadshow before the year lets out.

A great turnout it Indy

Not forgetting our Hot Topic Webinar series, the very next day our March webinar had a similar number of attendees for a great session on Strategic Planning for Captive Optimization and Future Success. Many thanks to the erudite panelists, and the State of Vermont’s own Christine Brown who moderated the talk.

These events and others, both online and in-person, have served us well as we identify in-demand topics and exceptional presenters for our August 2022 conference. We are about 6 weeks away from registration, but you can get a ‘sneak peak’ of the entire schedule and sign up for more info at VCIA.com.

Cheers to you, captive learning, and captive collaboration. Happy spring!

Captive Insurance and Rugby: Staff Spotlight on President Kevin Mead

Captive Insurance is a bit like rugby. Let me tell you why.

Just three weeks in, and I have quickly learned some truths about the captive insurance industry. Truth number one: how badly it is understood by those outside. Even those that have a knowledge of risk or insurance sometimes seem to shake their heads and mutter darkly when the subject is raised. Truth number two: that external lack of knowledge (or potentially confusion) means that the industry itself is tight knit, cooperative, and friendly.

Over 25 years ago, authors Adam Brandenburger and Barry Nalebuff co-authored a book called Co-Opetition in which they used game theory to suggest that businesses should cooperate to “grow the size of the pie,” and then compete for a larger slice of that enlarged pie.  Seeing the way in which board members and other VCIA volunteers are working together for the benefit of the association and for the industry is almost a case study in what the authors refer to.

“Real success comes from actively shaping the game you play—from making the game you want, not taking the game you find.”

― Barry J. Nalebuff, Co-Opetition

A second thing that has struck me is the number of rugby people there are in the captive industry. And there are similarities! To the uninitiated, rugby looks dangerous, risky, and somewhat unmanaged. To those that know the game, it is subtle, nuanced, athletic, and referred to as “the game they play in heaven.” On the field, rugby players are intensely competitive, but once the final whistle blows the bruises and battles are forgotten and a spirit of camaraderie and mutual support comes to the fore.

So, rugby as a metaphor for captive insurance? Perhaps that is too much of a reach! But my predecessor, Rich Smith, commented to me multiple times that the essence of the VCIA was built around mutual respect, understanding, and a sense of all being in the same league—if not all on the same team.

For me, rugby season is about to start up. This Saturday, the 19th, I will be refereeing at a tournament put on by the University of Vermont women in Burlington. Feel free to check this out or any rugby game in your location and see if my comments on the similarities hold any water! 

Announcing the 2nd Keynote Speaker for our August Conference

Enjoy political thrillers? Then you will need to hear from Michael Weidokal, founder of International Strategic Analysis, at the VCIA Conference!

These days, it’s an understatement to say global geopolitical stability is being challenged—look no further than Ukraine. I often find it difficult keeping up with intricate and sometime disparate elements that bear consequences not just worldwide, but at home. Which is why I’m proud to announce that VCIA has secured a second keynote speaker for our conference in August—Michael Weidokal, founder of International Strategic Analysis, and a shrewd economic and political forecaster. His lecture will be timelier and more relevant than ever.

Founder of International Strategic Analysis and VCIA Conference Keynote Speaker Michael Weidokal

I’ve used Michael as a speaker three times in my career, and I kept coming back to him because he consistently received top marks from audience feedback. I think what makes him so effective is his facility at explaining and distilling global structural challenges, their historical backgrounds, and their potential economic fallout. To put it in a nutshell: Michael combines economic theory and geopolitical situations, rendering them into a real-life political thriller, all the while predicting, with sufficient evidence, how they impact you and your business. You will be both intrigued and informed—hallmarks of a successful and worthwhile keynote address.

Michael combines economic theory and geopolitical situations, rendering them into a real-life political thriller… while predicting… how they impact you and your business.

His deeply researched and vetted lecture, “Global Economic and Risk Outlook,” draws interest from many different industries and conference circuits. According to Michael’s website, the general theme of his speech investigates “factors that are driving or hindering economic growth in the United States and in all of the world’s major economies.” Utilizing the latest data and current events, Michael will provide VCIA Conference attendees “an in-depth analysis of all of the important issues and trends that will impact their activities in domestic and international markets, both in the year ahead and over the long-term.”  

We can’t wait for you to meet Michael Weidokal, and he’s excited too. Learning that our conference is the premier event of the captive industry, he added to me in an email, “I very much look forward to speaking at this year’s VCIA conference!”

Don’t forget he’s the second of two outstanding keynote speakers we now have. The inimitable Admiral Michelle Howard, the first woman in the U.S. Navy’s 236-year history to be promoted to four-star admiral who achieved the second highest-ranking in the service, will share her experiences and insights on national security, leadership, risk, and much more.

VCIA’s 37th Annual Conference Distinguished Keynote, Admiral Michelle Howard

If these two won’t get you to come to our first, in-person conference in three years, what will? I guarantee you amazing and topical presentations, plus wonderful networking and business development opportunities.  I also guarantee you the pleasures of summer in Burlington, Vermont—stunning views of Lake Champlain, the festive atmosphere of Church Street, and quick access away to the lush Green Mountains and the great outdoors. A perfect destination for you and your family.

Registration opens May 16th.

Water, Sun, Mountains, and Captive Insurance…

See you at CICA

Today I will be hopping on a plane destined for the southwest; Tucson, Arizona, to be exact – where CICA’s 2022 International Conference will be taking place. In span of just a few weeks, I will have attended the World Captive Forum in Miami and now CICA. It’s hardly been a gradual easing into the position of President of VCIA; rather the opposite: I’ve jumped in and enjoyed every moment of it.

With our affable Director of Membership Janice Valgoi, I spent my days in Miami meeting many wonderful folks who make the captive industry what it is. Perhaps more importantly, I was able to carefully listen to their concerns and hopes for the state of captive insurance in 2022. I also participated in Captive 101, something VCIA will feature in its Conference this August. The course in Miami was engaging and informative. A “brains trust’’ (including Vermont’s own Dave Provost) did their utmost to make captives intelligible to those of us who are new arrivals. Any lack of understanding was my fault, not theirs!

Learning from the greats at the World Captive Forum: Dave Provost, and VCIA Board Chair Andrew Baillie

Now, having World Captive Forum in the rear view, I look forward to CICA with even more enthusiasm. In Miami, it was tremendously energizing and delightful to be with people in person again, and I was warmly welcomed by so many important makers and doers within the captive industry, some of whom have decades of institutional knowledge and experience! Many thanks to the State of Vermont’s Dave Provost and his team for hosting us at their World Captive booth.

it was tremendously energizing and delightful to be with people in person again, and I was warmly welcomed by so many important makers and doers within the captive industry

I’m Irish, and so I will cheerfully enjoy the Craft Brewery Tour during the CICA event. I hope we can raise a glass together and get to know each other. I look forward to making strong professional connections and learning more about the intricacies of captive insurance in the process. So, please, do reach out at the conference, and see you at CICA!

Finally, all connected with the VCIA are looking forward to welcoming you back to Burlington in August after a two-year virtual hiatus.  Bigger, better and stronger – please come and celebrate VCIA’s 37th Annual Conference! Registration opens May 16th.


Kevin Mead became the President of VCIA in February 2022. Send him a greetings or open up a conversation with him at kmead@vcia.com

Welcome, Kevin!

Earlier this month you met our new Communications Director, Francis McGill. Now I would like to take the opportunity to introduce my replacement as President of VCIA, Kevin Mead!

Kevin Mead, new VCIA President

As you may have seen in our announcement earlier this week, Kevin brings a boatload of skills in association management and financial wherewithal based on his experience running a number of associations. (Click here for the official announcement.)

Kevin is a unique fellow: he lives in Vermont’s Northeast Kingdom (the most rural part of our rural state), has a British accent, and loves rugby. But more than that, I got to know Kevin over the past few months, and he is truly a nice, decent human being – someone who will fit right into the captive insurance family.

Holding two master’s degrees related to association management and finance, Kevin is the perfect candidate to lead VCIA, build out the captive industry’s flagship conference, increase VCIA membership and membership value, while evolving the organization amid the current pandemic and economic challenges. Above all, he is a true “people’s person.” Our staff is thrilled to have him on board and I know he will make many meaningful and productive relationships with our members.

Although his official start date is February 22nd, Kevin has been hard at work absorbing all things captive insurance and VCIA over the past few weeks. He will be traveling to Miami for the World Captive Forum with VCIA’s own Janice Valgoi and the incredible team from the State of Vermont, so, if you are going to be there, please take the time to reach out and introduce yourself.

Thank you and I look forward to hearing from you.

Hail to 40 Years!

Vermont’s 40th anniversary year of the inception of its captive industry is drawing to a close. Since 1981, Vermont has worked hard to be the top U.S. domicile and continues to strive for excellence. Currently, VCIA is working with Dave Provost and Sandy Bigglestone and their team at DFR to build another captive bill to be introduced into Vermont’s General Assembly.

Over the past two years of COVID challenges, the Gold Standard has never been so apropos as Vermont lead the captive insurance industry in incredible growth and resiliency. I could not be prouder to be a part of this great work.

Brittany Nevins, in her role as Captive Insurance Economic Development Director, has put together a terrific short film highlighting relationships, accomplishments, future goals—and really what it means to be part of the Vermont captive family. I hope you will watch and encourage you to share.

Stay well and see you soon!

Rich Smith,
VCIA President

Can We Talk?

As I mentioned last week, collaboration is at the core of what makes VCIA so important to the broader captive insurance industry.  Understanding that, we’ve scheduled several semi-structured, interactive Discussion Groups  during the upcoming VCIA Conference  open to all attendees to allow the captive community a chance to converse with one another around topics of interest.

One group, whose focus is Getting Comfortable with Change, asks questions like ‘how do we accept and learn to even embrace change, and how do we assist our colleagues and clients in embracing change?  What opportunities and risks are developing because of recent events in our world?’ They will also explore how  companies are utilizing  captive programs to mitigate risks and enhance corporate wellness programs.

US Regulatory Realm is a Discussion Group that will give insight into what the NAIC is working on and its impacts on captives.   Lead by Vermont’s Director of Captive Insurance, Sandy Bigglestone, and Zaw Win, a director in DRM’s Business Law and Captive Insurance groups (and chair of VCIA’s Legislative Committee), this is an opportunity to look at the industry from a state regulatory view, allowing the group to discuss and consider a more uniform approach to working through key items as a collective unit.

One group of experts will provide some background on a proposed federal backstop for business interruption and event cancellation claims that occur because of a pandemic or public health emergency. The Pandemic Risk Insurance Act (PRIA), mirrors many of the fundamental mechanics of the Terrorism Risk Insurance Act (TRIA) which was established in the wake of September 11, 2001, to help provide adequate terrorism coverage in the United States. Will PRIA be good for captives? Are there other options? Will it pass? Come  join in the discussion to find out.

The certainties of life: death, taxes, and collateral. That is what Ed Koral of BDO, and Jeff Packard of PMA will serve up through a lively exchange of war stories, cautionary tales, and common-sense tips on how to navigate your organization through difficulties with reinsurance or self-insurance collateral requirements. Collateral Without Damage highlights steps you can take to ensure that you are better prepared for contentious negotiations and equipped with more leverage.

Everyone in our industry knows we need to attract and foster the next generation of professionals who will take captive insurance to new heights. Finding a Mentor is perfect for those new to the industry and looking to make their mark, as well as those who are long-standing members of the industry, looking to share knowledge, help someone along, and find a renewed purpose. 

Totally Cellular, Dude! You guessed it, the growth of new cell and sponsored captive formations across all domiciles will cover a brief background on cell/sponsored captives and explore recent developments, innovative uses, reporting and general evolution.

Talk amongst yourselves! The VCIA Annual Conference will be held online August 10 – 12th, which is fast approaching. Take a moment now to check out all the details here and Register Today! Thank you and I look forward to seeing you soon!

Rich Smith
VCIA President

Time to Gear Up!

As we all have heard over the past year or more, the captive insurance market is booming. I can’t tell you how many of our members I have spoken with  in the past few months who’ve mentioned how busy they are  setting up new captives, or helping clients expand current captive programs.  Dave Provost from Vermont’s Department of Financial Regulation reported  that Vermont has already licensed over 20 new captives – a “normal” year for Vermont is about 24,  and we are not even halfway through the year!

So, that said, this is the perfect time to open registration for the VCIA Annual Conference! The event will be held virtually August 10th – 12th and registration officially opens June 15th. There will be plenty of top level education  for newbies to get a better handle on this new risk tool they have just established,  and plenty on how best to optimize captive programs that have been around for a while.

Sessions include setting up new captives, reinsurance programs that are available and appropriate for captives, and a discussion of whether risk retention groups are a mature industry.  In addition, this year’s VCIA conference will include education focused on  captive taxation issues and captive investment portfolios.  The conference will conclude with a session in which Dave Provost and his stellar team  will discuss captive “hot topics” with the top risk manager for Starbucks.  Educational sessions will continue to discuss up to the minute emerging and current risks, and how captive programs relate to those risks.

This August we will be offering more ways for small groups to connect in video chat rooms. The event will feature  Ignite Talks,  Solution Labs, Morning Coffee and great keynote speakers. CPE, VT CLE and CRE credits are available to those who participate in the virtual conference webcasts. 

So keep an eye out for conference details and  registration opening next week, and prepare yourself to gear up!

Thank you and I look forward to seeing you soon.   

Captives and Debtors

Interesting news about OxyContin maker Purdue Pharma seeking product liability insurance and general liability coverage by creating a captive insurer.  Purdue asked for permission to set up the captive insurer in federal court on Monday as part of the firm’s filing for bankruptcy protection, as it has been challenging for them to find a commercial solution with a third-party insurer, not surprisingly.  Purdue faces more than 2,600 lawsuits alleging that it helped fuel the U.S. opioid epidemic.

As VCIA Member (and recipient of VCIA’s 2019 Industry Service Award!), Chaz Lavelle of Bingham Greenebaum Doll LLP stated recently in a September 17 article in Business Insurance,  “We’ve had situations in the past where an operating company has gone bankrupt but the captive insurer which it has previously set up was fully solvent, continued to operate and pay claims notwithstanding the bankruptcy and the disposition of the company.”

It reminded me of the Vermont captive for the bankrupt firm Enron back in the 90s. Even though the firm was mired in bankruptcy proceedings due to the fraudulent leadership at the top, under the supervision of Vermont’s Department of Financial Regulation its captive remained solvent and paid out every one of its claims under its policies in full. Having the captive kept the policy claims separate from the bankruptcy proceedings. Even debtors require various liability, casualty, property and other insurance programs in the ordinary course of their businesses.

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

Rich Smith
VCIA President