But the world’s leading domicile for captive insurance? Those
rural and bucolic images belie Vermont’s leadership in the growing alternative risk management industry.
For 30 years, Vermont has been a global leader in captive insurance. Using the latest data through 2010, Vermont is number one in gross premium, number one in assets under management, and third in total numbers of captives in the world. Vermont is home to 42 of the Fortune 100, and 18 of the companies that make up the Dow 30 have Vermont captives.
2010 was a year of captive insurance growth for Vermont, with 33
new captives being licensed. The new captives formed include 19 pure captives, nine special purpose financial captives (SPFC), four new risk retention groups and one industrial insured captive, bringing the total number of licences issued at year end in Vermont to 911.
Some of the companies in the class of 2010 include: NBC Universal, PricewaterhouseCoopers LLP, Aetna Inc., Proctor & Gamble Company, Crowe Horwath LLP, Towers Watson & Co, and Nationwide Financial Services.
Why Vermont?
Firm and fair regulation First is our balance of firm and fair regulation. The trade press called
Vermont’s law and experienced regulators “the gold standard”, and since 1981, successive governors and legislatures have worked hard to keep current with the changing needs of this dynamic industry. Despite challenging economic times for states throughout the nation, Vermont has continued to invest in our captive insurance division while other domiciles have downsized. This experienced staff is knowledgeable and ready to handle all inquiries, and provide ongoing examinations and service to existing captives and to new formations.
World-class infrastructure support Second is our infrastructure of brokers, managers and accountants
that make Vermont a ‘one-stop shop’ for the management expertise companies are looking for when considering captive strategies. Vermont’s captive infrastructure is sophisticated and diverse, with 14 approved captive management firms. The options range from the largest insurance brokers in the world to smaller independent captive managers.
No matter whom you choose, you can be assured that you will be
working with some of the best captive experts in the industry. You will also find a full complement of other service providers to help ensure a complete team will be working for you and your programme. There are knowledgeable investment professionals, bankers, actuaries, accountants and lawyers all ready to serve your needs.
The infrastructure is further complemented by the largest captive
insurance trade association in the world, the Vermont Captive Insurance Association (VCIA). The VCIA provides constant support for the Vermont domicile and is an excellent partner to the state. It hosts the world’s largest captive insurance conference held annually in August. This event saw more than 1,200 attendees last year. The conference has become a ‘must attend’ event, and provides incredible education and networking opportunities. It also brings together all of the leading stakeholders of the captive industry to share knowledge and best practices. You can find out further details regarding the conference by visiting:
www.vcia.com.
36 US Captive . April 2011 Consistency
Third is consistency. Vermont can arguably boast the most stable regulatory environment in the world. Since 1981, only three individuals have led its captive insurance division. Currently, deputy commissioner David Provost—a 22-year industry veteran—and Sandy Bigglestone, director of captive insurance with 14 years in the business, represent the most experienced and knowledgeable regulatory team anywhere. This means that you will not waste time, but can expect to receive some of the best advice you can get in the initial formation process and ongoing support of your captive programme. Twenty-eight individuals make up the regulatory team, which is the largest and most comprehensive in the industry. This is important as new applications are reviewed efficiently, with the process usually taking no more than 30 days from receipt of a completed application.
As your captive matures, Vermont’s captive department becomes
a partner for your captive. We were here yesterday and we’ll be here tomorrow to provide ongoing support to help your captive insurance company evolve and grow. It is common to have your captive add new lines of business or make plan changes, which require the approval of the department. These plan change requests can be very important to the ongoing success of your insurance programme.
In Vermont, this process usually occurs in a matter of days, not
weeks or months. The department can often accommodate more urgent time requirements, if needed. Examinations are done by Vermont examiners—not contract examiners—which keeps the process affordable, timely and competent.
Governors and legislatures since 1981 have had a track record of extraordinary support for the captive industry. Virtually every year, Vermont makes changes to, and fine-tunes, its leading insurance regulation. In 2011, we are seeking to broaden our legislation to
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