Captive Insurance Issues and Trends 2017
A FREE 30-page special report courtesy of Captive.com
Dig deep into important issues and trends in captive insurance. Download this FREE special report featuring practical knowledge and insights from 11 respected captive insurance thought leaders!
Download FREE Report Now
One of this editor's favorite songs is Elton John's "Where to Now St. Peter?" from the 1970 album "Tumbleweed Connection." It seems extremely apropos to the bond market after the recent election results.
Glenn Saslow, CPA, partner at Crowe Horwath LLP, recently offered a glimpse into his auditing experience with the captive insurance industry.
On May 23, 2016, the Office of the Montana State Auditor, Commissioner of Securities and Insurance (CSI), suspended the license of CareConcepts Insurance, Inc., a risk retention group (RRG), allowing the Insurance Department to take control and supervise CareConcepts. On August 8, 2016, the Montana CSI issued a court order, signed by a Montana District Court Judge, to commence liquidation of CareConcepts. On August 10, 2016, CareConcepts was placed into liquidation. Michael J. FitzGibbons, president of FitzGibbons and Company, Inc., was appointed as special deputy liquidator on August 22. Claims against CareConcepts have a deadline of March 31, 2017.
The outlook for Golden Insurance Company, RRG, has been revised from stable to negative by A.M. Best, and its financial strength rating of B (Fair) has been affirmed. The revised outlook is worth the review of all in the risk retention group (RRG) community. The rating reflects issues that every RRG should be concerned about as they seek to maintain financial and operational sound companies.
The low interest rate environment is "the single biggest problem [for insurers] we have in the workers comp market right now" says John Leonard, president and chief executive officer of Maine Employers' Mutual Insurance Company.
The U.S. Securities and Exchange Commission (SEC) recently instituted new regulations governing institutional money market accounts. The historical context for this change dates back to the financial crisis of 2007–2008.
The Captive Insurance Council of the District of Columbia (CIC-DC) will open its 2016 Annual Conference on Tuesday, October 18th, with a networking reception, followed by a full day of educational sessions on October 19th. The Conference will be held at Loews Madison Hotel in Washington, DC.
Most captive owners and managers, if they follow the Federal Reserve at all, probably focus on the pronouncements made from the Federal Open Market Committee (FOMC). The latest release was on September 21, 2016, and concerns the Federal Reserve's short-term outlook and its expectations for changes to interest rates. The release on the 21st contained the following language.
According to Demotech's Douglas Powell, the bottom line for risk retention groups (RRGs) at the conclusion of the second quarter of 2016 is "that these specialty insurers continue to exhibit financial stability."
Captive Insurance Companies Association (CICA) has scheduled a webinar, titled "Brexit and the Impact on the Captive Industry," to be held at noon (CDT) (1:00 p.m. ET) October 20, 2016.