“Vermont is home to 42 of the Fortune 100, and 18 of the companies that make up the Dow 30 have Vermont captives.”


allow incorporated protected cell structures. We are also proposing to expand the options for structures of cell captives and making the ‘tax holiday’ permanent for newly licensed captives. Other technical amendments are being proposed to keep us at the forefront of captive legislation. These proposals have been widely supported by legislators across the political spectrum.


Captive insurance is a very important industry to the Vermont economy. It creates more than 1,400 full-time and part-time jobs, and creates direct tax revenue that generates approximately 2 percent of the general fund budget. To put it in perspective, if those 1,400 jobs were at a single employer in Vermont, it would be a top-10 employer in terms of size of employees.


While offshore domiciles experienced a decline in total numbers


from 2009 to 2010, Vermont experienced steady growth. Hospital and physician groups forming captives for medical malpractice coverage are on the rise, with nearly 100 physician and hospital groups, writing $1 billion in premium volume, now domiciled in Vermont. This line of business—often perceived as the purview of offshore domiciles—is finding its way onshore and to Vermont. Some of the nation’s largest hospitals have chosen Vermont for their captives. New healthcare captives in the class of 2010 include: Albert Einstein Healthcare Network, a group of Midwestern Physicians, Nursing Homes & Home Healthcare Agencies, and a group of New Hampshire hospitals.


Vermont is also a leader in risk retention groups (RRG), with most


of the largest RRGs domiciled in Vermont. Vermont has also taken an active role in support of RRGs with the National Association of Insurance Commissioners (NAIC), with representation on all of the NAIC’s working committees affecting captives. RRGs are in good hands when they are licensed in Vermont. In addition, employee benefits in captives also continue to be a strong area of interest, with


most of the U.S. Department of Labor-approved captives writing their premiums through a Vermont captive.


We’re known for large captives, but you may be surprised to know


that one of Vermont’s largest sectors of growth is in captives that write $5 million or less annually in premium. This sector makes up half of all of Vermont’s licensed captives. In fact, Vermont has 150 captives that write $1 million or less annually.


While larger premium volume may create additional savings for some


companies forming captives, smaller companies can still benefit in many of the same ways as larger companies from forming captives. It is still an excellent way to take control of your risk management programme, and we can show you why captives might make sense for smaller companies as well.


Choosing the right domicile is critical to the long-term success of


your insurance programme, and forming a captive is not a single transaction but, rather, it’s a process. Make Vermont your first contact. If it doesn’t look like a good fit, we’ll be the first to suggest other options to make your programme successful.


We’re poised for another strong year for captive growth in 2011,


with the first quarter off to a very promising start. Find out what 42 of the Fortune 100 have already learned—that Vermont is “the gold standard”. So look around, conduct your due diligence, and in the end, we’re confident that Vermont will exceed your expectations.


And you will be among some great company.


Dan Towle is the director of financial services for the State of Vermont. He can be contacted at: dan.towle@state.vt.us. More information about Vermont can be found at: www.vermontcaptive.com


US Captive . April 2011 37


©iStockphoto.com / RonBlekicki


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60