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Economic Impact of Delaware Captive Industry

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August 16, 2016
The captive industry is making a significant contribution to the Delaware economy, according to the August 2016 "Captive Industry Impact in Delaware" report, which was based upon a survey of 1081 captives doing business in Delaware. The captive industry contributes nearly $360 million to Delaware’s gross domestic product (GDP), 2,537 jobs, nearly $109 million in personal incomes, and $5.6 million in taxes.

The report was produced by the Center for Applied Business and Economic Research (CABER), Alfred Lerner College of Business, University of Delaware and sponsored by the Delaware Department of Insurance. One of the ways the report measures the impact is based upon the expenditures of the Delaware Department of Insurance Bureau of Captive and Financial Insurance Products annual expenditure of $1.3 million. It breaks out the impact per $1,000 spent. For every $1,000 spent, $276,075 is contributed to Delaware's GDP, 1.95 jobs are created, $83,574 in income is generated, and $4,301 in taxes are collected. Captive program spending supports 950 jobs in finance and investment industry; 447 jobs in legal, accounting, and professional support; and 209 jobs in retail, among others.

“I instituted the Bureau of Captive and Financial Insurance Products in 2009 and I’ve watched it grow ever since,” said Insurance Commissioner Karen Weldin Stewart in the August 10, 2016, Delaware.gov article "UD Report: Captive Insurance Program Boosts Delaware's GDP, Jobs, Incomes, Tax Revenue." “Thanks to my captive director, Steve Kinion, and my topnotch captive staff, we are consistently one of the top captive domiciles in the US and in the world. But until now, I don’t think many people were aware of exactly what we contribute to Delaware’s economy. The CABER report rewards my faith in captives as a revenue generator for our state.”

According to the article, the Department of Insurance’s "captive bureau is self-sustaining and currently contributes an annual surplus in tax and fee revenue of over $3 million to the Delaware general fund."

Read the complete CABER report.
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