On June 2, 2008, Connecticut Governor Jodi Rell signed S.B. 281 into law making Connecticut the latest state to permit the formation of captive insurance companies. S.B. 281 is very similar to the captive insurer statutes of Vermont, currently the largest U.S. domicile for captive insurance companies. Connecticut will require a minimum capital and surplus of $250,000 for a single-parent captive, $500,000 for a captive organized by an industrial insured, $750,000 for an association captive and $1,000,000 for risk retention group. An industrial insured is an insured: (i) who procures the insurance through a full-time employee acting as an insurance manager or buyer; (ii) whose aggregate annual premiums for insurance on all risks total at least $25,000; and (iii) who has at least 25 full-time employees. Additionally, Connecticut’s annual premium taxes will range from a minimum of $7,500 to a maximum $200,000.
To view the complete text of S.B. 218, which is effective January 1, 2009, click here.