Tennessee Captive Domicile Licenses 200th Captive Insurer
February 21, 2020
Joining just a handful of other US domiciles, Tennessee last week licensed its 200th captive.
That captive, Mattoon Insurance Company, owned by Rural King, a Mattoon, Illinois-based farming supply store, will write property and contractual liability coverages.
"The licensing of Tennessee's 200th captive is a significant landmark because it is proof of how far Tennessee has come in a relatively short time since our captive insurance regulations were revised to make Tennessee more attractive to captive insurance companies," Tennessee Department of Commerce and Insurance (TDCI) Commissioner Hodgen Mainda said in a statement.
Indeed, just before Tennessee lawmakers in 2011 revamped its then more than 3-decade old captive statute, the state had just two captives.
But growth followed the 2011 law, which, among other things, set new captive minimum capital and surplus requirements and other measures, such as the 2017 statute that slashed capital and surplus requirements for dormant captives.
Indeed, at the end of 2019, Tennessee had—excluding inactive and cell captives—140 captives, up nearly 20 percent since 2015, when the state had just 117 captives.
Captive growth is continuing, said state regulators. So far this year, Tennessee has already licensed four captives, with six captives currently in the approval process. "While certain markets are hardening, captives show no sign of slowing down," TDCI's Captive Insurance Sector Director Jennifer Stalvey said in a statement.
Just as its number of captives has increased, so has Tennessee captives' premium volume. "When the Tennessee statute was revised in 2011, the average premium volume per captive in Tennessee was under $2 million. Today, the average premium volume per captive is anticipated to exceed $10 million," Tennessee Director of Business Development Michael Corbett said in a statement.
Currently, Tennessee is the seventh-largest captive domicile in the United States, Tennessee regulators say.
February 21, 2020