UTAH
UTAH:
A WESTERN CHAMPION
F
ollowing the wildly successful 2002 Winter Olympics, Utah gained enhanced international exposure. The state enjoyed new Olympic-quality facilities, an updated transportation infrastructure and a worldwide reputation for the ‘best snow on earth’. The residents
of the state were elated and shared a contagious excitement for the future. Optimism was high, unemployment was low, the economy was on a roll, and the future was bright.
Then-Governor Jon Huntsman had a vision to capitalise on these elements as he designed and spearheaded an aggressive economic development initiative. The results of his initiative are impressive. The transportation infrastructure, including freeways and public transit, has been extensively upgraded. Numerous large corporations were attracted to Utah by the low cost of doing business, a young and highly educated workforce, diverse recreational opportunities and a business-friendly government.
Utah has since been recognised several times by prominent institutions. In 2010 Forbes placed Utah in the top spot on its 2010 Best States for Business list. The rigorous study measured six key categories—costs, labour supply, regulatory environment, current economic climate, growth prospects and quality of life—drawn from 33 primary data points.
Furthermore, the state’s pro-business regulatory climate earned it a number two ranking on the Pacifi c Research Institute’s index of regulatory issues in its 2010 US Economic Freedom Index. In addition, Utah has a AAA debt rating from Moody’s, S&P and Fitch. In 2011, Forbes crowned Utah the country’s most fi scally fi t state government. The ALEC-Laffer State Economic Competitive Index also ranks Utah the number one state for ‘economic outlook’, based on its ‘conscientious efforts’ to maintain a best-in-class environment for businesses in the state.
126 CICA | Forty years of captive leadership
Ross Elliott of the Utah Insurance Department outlines Utah’s strengths as a captive domicile and the factors that have enabled the state to achieve enviable growth in recent years.
Governor Gary Herbert continues to set the tone for the relationship between business and government. During his 2011 State of the State address, he reiterated the intention to “keep government off the backs and out of the wallets” of business. The objective is to continue the creation of new jobs in the state economy without increasing the role of the government.
Business-friendly regulatory environment In 2002, under the direction of deputy commissioner Neal Gooch, extensive research and coordination resulted in the passage of the Utah Captive Insurers Act in 2003. The act provides for the creation and regulation of several types of captive insurance structures, including pure, association, branch, sponsored, industrial insured (risk retention groups), reinsurance, and special purpose. Separate legislation in 2008 added special purpose fi nancial captives to the list.
Refl ecting Utah’s business-friendly culture, the stated purpose for the captive legislation is the creation of professional job opportunities, employment growth, and risk management opportunities for Utah’s burgeoning businesses. With that purpose in mind, Utah opted to bypass the traditional funding for captive insurance regulation. Instead of
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