Vermont Statutes Title 8 Sec. 6034a
Terms Used In Vermont Statutes Title 8 Sec. 6034a
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- 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
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Incorporated protected cell: means a protected cell that, subject to the approval of the Commissioner, is formed as any type of entity permissible under Vermont law, separate from the sponsored captive insurance company of which it is a part. See
- Mutual corporation: means a corporation organized without stockholders and includes a nonprofit corporation with members. See
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Protected cell: means a separate account established by a sponsored captive insurance company formed or licensed under the provisions of this chapter, in which assets are maintained for one or more participants in accordance with the terms of one or more participant contracts to fund the liability of the sponsored captive insurance company assumed on behalf of such participants as set forth in such participant contracts, and shall include an "incorporated protected cell" as defined in this section. See
- Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
- Sponsored captive insurance company: means any captive insurance company:
§ 6034a. Incorporated protected cells
(a) A protected cell of a sponsored captive insurance company may be formed as an incorporated protected cell as defined in subdivision 6032(2) of this title.
(b) Subject to the prior written approval of the sponsored captive insurance company and of the Commissioner, an incorporated protected cell shall be entitled to enter into contracts and undertake obligations in its own name and for its own account. In the case of a contract or obligation to which the sponsored captive insurance company is not a party, either in its own name and for its own account or on behalf of a protected cell, the counterparty to the contract or obligation shall have no right or recourse against the sponsored captive insurance company and its assets other than against assets properly attributable to the incorporated protected cell that is a party to the contract or obligation.
(c) The articles of incorporation or articles of organization of an incorporated protected cell shall refer to the sponsored captive insurance company for which it is a protected cell and shall state that the protected cell is incorporated or organized for the limited purposes authorized by the sponsored captive insurance company’s license. A copy of the prior written approval of the Commissioner to add the incorporated protected cell, required by subdivision 6034(8) of this title, shall be attached to and filed with the articles of incorporation or the articles of organization.
(d)(1) An incorporated protected cell formed or established prior to May 8, 2023 shall have its own distinct name or designation, which shall include the words “Incorporated Cell” or the abbreviation “IC” or, in the alternative, such incorporated protected cell may instead choose to have its own distinct name or designation consistent with the naming conventions in subdivisions (2)(A)-(C) of this subsection, as applicable. The provisions of 11A Vt. Stat. Ann. chapter 4 and 11B Vt. Stat. Ann. chapter 4 shall not apply to the naming of incorporated protected cells.
(2) An incorporated protected cell formed or established on or after May 8, 2023 shall have its own distinct name or designation as follows:
(A) If the incorporated protected cell is formed or established as a corporation, mutual corporation, or nonprofit corporation, its name or designation shall include the words “Incorporated Cell” or the abbreviation “IC.” The provisions of 11A Vt. Stat. Ann. chapter 4 and 11B Vt. Stat. Ann. chapter 4 shall not apply to the naming of such incorporated protected cell.
(B) If the incorporated protected cell is formed or established as a limited liability company, its name or designation shall include the word “Cell.” In addition, 11 V.S.A. § 4005 shall apply to the naming of such incorporated protected cell.
(C) If the incorporated protected cell is formed or established as a reciprocal insurer, its name or designation shall include the word “Cell.” In addition, subdivision 4834(1) of this title shall apply to the naming of such incorporated protected cell.
(e) It is the intent of the General Assembly under this section to provide sponsored captive insurance companies, including those licensed as special purpose financial insurance companies under subchapter 4 of this chapter, with the option to establish one or more protected cells as a separate corporation, mutual corporation, nonprofit corporation, limited liability company, or reciprocal insurer. This section shall not be construed to limit any rights or protections applicable to protected cells not established as corporations, mutual corporations, nonprofit corporations, limited liability companies, or reciprocal insurers. (Added 2011, No. 21, § 23; amended 2011, No. 78 (Adj. Sess.), § 36, eff. April 2, 2012; 2013, No. 29, § 50, eff. May 13, 2013; 2013, No. 103 (Adj. Sess.), § 8, eff. April 14, 2014; 2015, No. 20, § 5, eff. May 7, 2015; 2017, No. 12, § 9, eff. May 1, 2017; 2019, No. 110 (Adj. Sess.), § 10, eff. June 15, 2020; 2023, No. 12, § 3, eff. May 8, 2023.)