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The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance

A FREE 12-page special report from Captive.com

The COVID-19 Pandemic: Opportunities and Implications for Captive Insurance explores the challenges presented by today's business and economic upheaval, as well as the hardening insurance market, and what it means for the captive insurance industry.

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Texas Legislature Approves Captive Risk Pooling

Texas Capitol Building Austin
May 29, 2015

The Texas Legislature has approved legislation (S.B. 667) designed to encourage smaller companies to create or re-domesticate captives to Texas. The legislation, which has been sent to the governor for his approval, permits

  1. Texas captives to pool risk with other captives subject to approval by the Texas Department of Insurance (TDI) and
  2. Texas captives to take credit for reinsurance for risk ceded to a captive reinsurance pool composed only of other captive insurance companies holding a certificate of authority under Texas law or a similar law of another jurisdiction, or an affiliated captive insurance company holding a certificate of authority under Texas law or a similar law of another jurisdiction.

The legislation also clarifies the requirements for dividends to be paid to owners of captive insurers.

The Texas Captive Insurance Association (TxCIA) has been proactive in supporting the revisions to the captive legislation that was originally passed in 2013. TxCIA would like to see future legislative action on issues such as credit for reinsurance for risks ceded to nonadmitted reinsurers, authorization of reciprocal structures for captives within the same economic family, provision for the TDI to incorporate captive insurers (rather than the Texas secretary of state), and modifications to investment provisions in the captive statute.

The legislature has also passed a separate bill (H.B. 2557) that permits Texas hospital districts to form captives.

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