Captive Insurance

Rhode Island as a Domicile for Captive Insurance


Rhode Island has long distinguished itself as a world class insurance regulator. RI insurance regulators are known for being cautious but fair who are willing to discuss disagreements agreeably.  The Captive Unit within the Insurance Division is uniquely able to work beyond a pure regulatory regime and focuses on enabling captive owners to create a sustainable risk financing vehicle as a captive insurance subsidiary. The objective is to allow Rhode Island companies to appropriately plan for future risks today. 

In Rhode Island the captive regulatory process extends beyond just looking at liquidity, solvency, and compliance, as it also takes a principle-based focus on governance, strategic intent, and value creation for the captive insurance entity. Rhode Island is a captive domicile that is able to understand complex financial structures and facilitate the development of innovative and responsive risk solutions for captive owners.

The future of captive insurance is incredibly positive and Rhode Island is uniquely positioned to leverage deep talent in the insurance sector for the benefit of captive owners..

For more information please contact: DBR.companylicensing@dbr.ri.gov

DEFINITIONS: A captive insurance company is wholly owned and controlled by a parent company or association and operates to insure the parent’s own risks. In Rhode Island, a captive is defined as any pure captive insurance company, association captive insurance company, industrial insured captive insurance company, risk retention group, sponsored captive insurance company, or special purpose financial captive insurance company that is domiciled in the state and formed or licensed under the provisions of the Rhode Island Insurance Statues and Regulations.

CAPTIVE INSURANCE UNIT: The Captive Insurance UNIT evaluates licenses, regulates, and examines the captive insurers and risk retention groups in the alternative risk market for the State of Rhode Island. The alternative risk insurance market refers to several risk funding techniques, such as self-insurance, paid loss plans, insurance purchasing groups, and risk retention groups that are outside the scope of that provided by most traditional Property & Casualty or Life & Health insurers.

 

Captive Insurance Company Application Process
 

  1. Prior to applying to be licensed as a captive insurance company, please schedule a meeting with the Rhode Island Insurance Division.  At this meeting the prospective applicant should discuss the type of captive insurance company to be formed, ownership structure, specific insurance needs, sources and availability of capital, and the proposed business plan.  Please note that all issues discussed as well as the application are considered Confidential.  Refer to https://webserver.rilegislature.gov//Statutes/TITLE27/27-43/INDEX.htm  and https://rules.sos.ri.gov/regulations/part/230-20-45-10 for the applicable statute and regulation.
     
  2. The incorporators shall petition the superintendent to issue a certificate setting forth that the establishment and maintenance of the proposed corporation will promote the general good of the state. In arriving at the finding, the superintendent shall consider:

      i) The character, reputation, financial responsibility, insurance experience, and business qualifications of the
      incorporators and the proposed officers and directors.

     ii) The sources and availability of its capital; and

     iii) Other financial and business matters that the commissioner deems advisable.

  1. The articles of association and the certificate shall be transmitted to the secretary of state, who shall record both the articles of association and the certificate.
     
  2.  Each captive insurance company shall pay the superintendent a nonrefundable fee of one thousand dollars ($1,000) for examining, investigating, and processing its application for license.  In addition, it shall pay a license fee for the first year of registration and an annual fee for each after this of five hundred dollars ($500).  The initial application should include a business plan, feasibility study, and pro-forma financial statements.
     
  3. The application must be filled out in its entirety and submitted together with all required materials.  No incomplete applications will be accepted.

    i) If applicable the Application will be reviewed by one of the actuarial firms appointed by the superintendent.  The firms’ duties are advisory in nature and final approval, or disapproval of an Application will be made by the superintendent only.
     
  4.  Please submit complete application via email in unsecured pdf format to (Insert applicable email address) or via mail to: State of Rhode Island, Department of Business Regulation, Insurance Division, 1511 Pontiac Avenue, Bldg. 69-2, Cranston, RI  02920.
     
  5.  Application fees can be submitted via check or electronic fund transfer (ACH).  For ACH transfer instructions, please contact the following (Insert contact person).
     
  6.  For questions or guidance, please contact: Theodore J. Hurley, Chief Insurance Examiner, ted.hurley@dbr.ri.gov.

 



 

RI Captive Insurance Application