(a)  No subsidiary captive insurance company, association captive insurance company incorporated as a stock insurance company, or industrial insured captive insurance company incorporated as a stock insurance company shall be issued a license unless it possesses and after this maintains unimpaired paid in capital of:

(1)  In the case of a subsidiary captive insurance company, not less than one hundred thousand dollars ($100,000);

(2)  In the case of an association captive insurance company incorporated as a stock insurance company, not less than four hundred thousand dollars ($400,000); and

(3)  In the case of an industrial insured captive insurance company incorporated as a stock insurance company, not less than two hundred thousand dollars ($200,000). The capital may be in the form of cash or an irrevocable letter of credit issued by a bank chartered by the state of Rhode Island or a member bank of the Federal Reserve System and approved by the commissioner.

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Terms Used In Rhode Island General Laws 27-43-4

  • Association: means any association of individuals, corporations, partnerships, or associations that has a separate legal existence, the member organizations of which collectively:

    (i)  Own, control, or hold with power to vote all of the outstanding voting securities of an association captive insurance company incorporated as a stock insurance company; or

    (ii)  Have complete voting control over an association captive insurance company incorporated as a mutual insurance company. See Rhode Island General Laws 27-43-1

  • Association captive insurance company: means any company that insures risks of the member organizations of the association, and their affiliated companies. See Rhode Island General Laws 27-43-1
  • Captive insurance company: means any subsidiary captive insurance company, association captive insurance company, or industrial insured captive insurance company formed or licensed under the provisions of this chapter, including a captive insurance company that is organized as a protected cell company under the Protected Cell Companies Act, chapter 64 of this title. See Rhode Island General Laws 27-43-1
  • Commissioner: means the director of the department of business regulation. See Rhode Island General Laws 27-43-1
  • Federal Reserve System: The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system. The Federal Reserve System is composed of a central governmental agency in Washington, D.C. (the Board of Governors) and twelve regional Federal Reserve Banks in major cities throughout the United States. Source: OCC
  • Industrial insured: means an insured:

    (i)  Who procures the insurance of any risk or risks by use of the services of a full-time employee acting as an insurance manager or buyer;

    (ii)  Whose aggregate annual premiums for insurance on all risks total at least twenty-five thousand dollars ($25,000); and

    (iii)  Who has at least twenty-five (25) full-time employees. See Rhode Island General Laws 27-43-1

  • Industrial insured captive insurance company: means any company that insures risks of the industrial insured that comprise the industrial insured group, and their affiliated companies. See Rhode Island General Laws 27-43-1
  • Subsidiary captive insurance company: means any company that insures risks of its parent and affiliated companies. See Rhode Island General Laws 27-43-1

(b)  The commissioner may prescribe additional capital based upon the type, volume, and nature of insurance business transacted, which capital may be in the form of an irrevocable letter of credit issued by a bank chartered by the state of Rhode Island, or a member bank of the Federal Reserve System.

(c)  No captive insurance company may pay a dividend out of, or other distribution with respect to, capital or surplus, in excess of the limitations set forth in § 27-43-12, without the prior approval of the commissioner. Approval of an ongoing plan for the payment of dividends or other distributions shall be conditioned upon the retention, at the time of each payment, of the capital or surplus in excess of amounts specified by, or determined in accordance with formulas approved by, the commissioner.

History of Section.
P.L. 1988, ch. 76, § 1; P.L. 1996, ch. 232, § 1; P.L. 1996, ch. 256, § 1.