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How To Move Your Captive Insurer to a Different Jurisdiction

 

Captive Tax Issues | P. Bruce Wright | Partner | Eversheds Sutherland (US) LLP

 

In "Why Move Your Captive Insurance Company to a Different Jurisdiction," Bruce Wright of Eversheds Sutherland (US) LLP explains why an organization may want to move its captive to a different jurisdiction. In this follow-up addressing the question of how to move your captive to a different jurisdiction, he explains that the most common mechanism for moving a captive insurance company to a different jurisdiction is through a merger. One way to accomplish a merger, if both jurisdictions allow, is with a redomestication, which is effectively a merger.

Organizations also do assumption reinsurance agreements, which are novations. In this type of transaction, the insured agrees to look only to the new insurer to collect on all of the liabilities where there is a reinsurance contract from the old insurer to the new insurer and where the insured releases the old insurer from any liability.