(a) As used in this section, “dormant captive insurance company” means any captive insurance company other than a captive risk retention group that has:
Terms Used In Tennessee Code 56-13-124
Captive insurance company: means any pure captive insurance company, association captive insurance company, agency captive insurance company, industrial insured captive insurance company, risk retention group, protected cell captive insurance company, incorporated cell captive insurance company, or special purpose financial captive insurance company formed or licensed under this chapter. See Tennessee Code 56-13-102
Commissioner: means the commissioner of the department, or the commissioner's designee. See Tennessee Code 56-13-102
Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
Rescission: The cancellation of budget authority previously provided by Congress. The Impoundment Control Act of 1974 specifies that the President may propose to Congress that funds be rescinded. If both Houses have not approved a rescission proposal (by passing legislation) within 45 days of continuous session, any funds being withheld must be made available for obligation.
Risk retention group: means a captive insurance company organized under the laws of this state pursuant to the Liability Risk Retention Act of 1986, as amended, (15 U. See Tennessee Code 56-13-102
State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
(1) Ceased transacting the business of insurance, including the issuance of insurance policies; and(2) No remaining liabilities associated with insurance business transactions or insurance policies issued prior to the filing of its application for a letter of dormancy under this section.(b) A captive insurance company domiciled in this state that meets the criteria of subsection (a) may apply to the commissioner for issuance of a letter of dormancy. The commissioner may issue the captive insurance company a letter of dormancy in the commissioner’s sole discretion. A letter of dormancy issued by the commissioner shall specify an expiration date that is no later than five (5) years from the date of issuance. The commissioner may, before the expiration date, issue a superseding letter of dormancy. The superseding letter of dormancy shall specify a new expiration date no later than five (5) years from the date of issuance of the superseding letter.(c) A dormant captive insurance company that has been issued a letter of dormancy shall:
(1) Possess, and thereafter maintain unimpaired, paid-in capital and surplus of not less than twenty five thousand dollars ($25,000);(2) Prior to March 15 of each year, submit to the commissioner a report of its financial condition as required by § 56-13-108; and(3) Pay the fee established by § 56-4-101(a)(4).(d) A dormant captive insurance company that has been issued a letter of dormancy shall not be subject to or liable for the payment of the annual minimum aggregate tax provided for in § 56-13-114(c). A dormant captive insurance company shall be liable for payment of premium tax on premiums received before issuance of a letter of dormancy.(e) A dormant captive insurance company that has been issued a letter of dormancy must apply to the commissioner for and receive a rescission of the letter of dormancy and restore its unimpaired paid-in capital and surplus to the amount required in § 56-13-105 prior to issuing any insurance policies and resuming the business of insurance.(f) The commissioner shall rescind a letter of dormancy issued to any captive insurance company if that company no longer meets the criteria of subsection (a). Such rescission shall be effective as of the date the company ceased to meet the criteria of subsection (a).(g) In the commissioner’s sole discretion, an examination required by § 56-13-109 may be held in abeyance during the time the dormant captive insurance company is under a letter of dormancy.(h) An application for a letter of dormancy and an application for a rescission of a letter of dormancy constitute a change of business plan pursuant to § 56-4-101(a)(8).(i) The captive insurance company is responsible for all taxes, fees, and statutory requirements of this title for the year in which the rescission or expiration of its letter of dormancy occurs.(j) The commissioner may promulgate rules as necessary to effectuate the purposes of this section. All rules shall be promulgated in accordance with the Uniform Administrative Procedures Act, compiled in title 4, chapter 5.(k)(1) The commissioner may waive any requirement for a dormant captive insurance company under this section; and(2) Notwithstanding this section to the contrary, if the commissioner waives a requirement under subdivision (k)(1), the commissioner may impose actuarial reporting requirements and additional capital and surplus requirements on the dormant captive insurance company.
