Vermont Statutes Title 8 Sec. 6004
Terms Used In Vermont Statutes Title 8 Sec. 6004
- Agency captive insurance company: means a captive insurance company that is owned or directly or indirectly controlled by one or more insurance agencies or brokerages licensed under the laws of any state and that only insures risks of policies that are placed by or through such agency or agencies, or brokerage or brokerages, as applicable. See
- Association: means any legal association of individuals, corporations, limited liability companies, partnerships, associations, or other entities, the member organizations of which or which does itself, whether or not in conjunction with some or all of the member organizations:
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Captive insurance company: means any pure captive insurance company, association captive insurance company, sponsored captive insurance company, industrial insured captive insurance company, agency captive insurance company, risk retention group, affiliated reinsurance company, or special purpose financial insurance company formed or licensed under the provisions of this chapter. See
- Commissioner: means the Commissioner of Financial Regulation. See
- Industrial insured: means an insured:
- Pure captive insurance company: means any company that insures risks of its parent and affiliated companies or controlled unaffiliated business. See
- Risk retention group: means a captive insurance company organized under the laws of this State pursuant to the Liability Risk Retention Act of 1986, 15 U. See
§ 6004. Minimum capital and surplus; letter of credit
(a) Prior to issuing any policies of insurance or entering into any contracts of reinsurance, each captive insurance company shall possess and thereafter maintain unimpaired paid-in capital and surplus of:
(1) in the case of a pure captive insurance company, not less than $250,000.00;
(2) in the case of an association captive insurance company, not less than $500,000.00;
(3) in the case of an industrial insured captive insurance company, not less than $500,000.00;
(4) in the case of an agency captive insurance company, not less than $500,000.00;
(5) in the case of a risk retention group, not less than $1,000,000.00; and
(6) in the case of a sponsored captive insurance company, not less than $100,000.00.
(b) The Commissioner may prescribe additional capital and surplus based upon the type, volume, and nature of insurance business transacted.
(c) Capital and surplus may be in the form of cash, marketable securities, a trust approved by the Commissioner and of which the Commissioner is the sole beneficiary, or an irrevocable letter of credit issued by a bank approved by the Commissioner. The Commissioner may reduce or waive the capital and surplus amounts required by this section pursuant to a plan of dissolution for the company approved by the Commissioner.
(d) Within 30 days after commencing business, each captive insurance company shall file with the Commissioner a statement under oath of its president and secretary certifying that the captive insurance company possessed the requisite unimpaired paid-in capital and surplus prior to commencing business. (Added 1981, No. 28; amended 1993, No. 40, § 3, eff. June 3, 1993; 1993, No. 235 (Adj. Sess.), § 9d; 1999, No. 38, § 6, eff. May 20, 1999; 2003, No. 55, § 7; 2007, No. 178 (Adj. Sess.), § 5; 2009, No. 137 (Adj. Sess.), § 18, eff. May 29, 2010; 2011, No. 78 (Adj. Sess.), § 37, eff. April 2, 2012; 2015, No. 20, § 2, eff. May 7, 2015; 2017, No. 12, § 5, eff. May 1, 2017; 2019, No. 110 (Adj. Sess.), § 3, eff. June 15, 2020; 2021, No. 25, § 22, eff. May 12, 2021.)