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An Explanation of Captive Insurance and Direct Placement Taxes

Bruce Wright Featured Video-SF
August 15, 2018

Watch the latest Captive Thought Leader Video featuring Bruce Wright, partner at Eversheds Sutherland (US) LLP, titled "Captive Insurance and Direct Placement Taxes Explained," in the video library.  

Mr. Wright explains the Dodd-Frank legislation and direct placement taxes. Direct placement taxes (direct procurement taxes) apply to surplus lines placements as well as placements with any nonadmitted company, such as a captive insurer. The "home state" is what controls where the payment of this tax is concerned and is generally the principal place of business of the corporation that is paying the insurance premium. The tax analysis is done on a policy-by-policy basis based on where the largest amount of premium is located. This becomes an important factor in the context of a captive insurer's feasibility study and may ultimately influence how captive insurers do business and issue insurance policies.

(Pictured above is P. Bruce Wright, partner, Eversheds Sutherland (US) LLP.)

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