North Carolina Captive Insurance Association
CIT chats to Thomas Adams and Alex Webb of the North Carolina Captive Insurance Association to find out how the new domicile on the block is progressing
What will the NCCIA focus on in the coming months?
Thomas Adams: The NCCIA will be focused in the short term on educating businesses that there is a new in state tool for them to use in considering how to meet their insurance needs, using the captive insurance model. There has been strong interest from businesses in the bills’ progress and much of our effort will be directed toward educating businesses on the specifics of the legislation and how it may benefit their activity.
When do you think bills HB 473 and SB 476 will make it through Congress?
Alex Webb: HB 473 and SB 476 will be merged into one bill in the near future. Currently HB 473 is in the Senate Insurance Committee where we expect some technical amendments. On final passage, we expect it will contain the current content plus some of the technical changes. Upon adoption it will be a state of the art framework for regulation of captive companies in North Carolina.
How much support is there for North Carolina becoming a captive domicile?
Adams: The two bills moving through the legislature have initially passed both houses without a dissenting vote. That is very rare and indicative of the strong support in the state for North Carolina to be a key domicile for captives in the US.
North Carolina’s department of insurance and legislature are all very excited about the law. The goal is to become competitive with the active captive domiciles. The state understands that this is a competitive environment and they are ready. The law is state of the art legislation and it includes meaningful funding. There are also some differences from established captive domiciles, one example is the fact that North Carolina will not charge fees.
Is the US becoming too saturated with domiciles, and why?
Webb: While more than 30 states allow captives, only a handful have aggressively marketed their regulatory frameworks.
The intent of the North Carolina legislation is for the state to aggressively market itself and subsequently become a key home for captive companies.
As a new US domicile, what will North Carolina offer that other domiciles currently do not?
Webb: North Carolina’s law is being crafted in such a way that it is friendly to businesses that want to pursue the concept. It is seen in the legislature as an economic development tool. Businesses will need to compare this law to others. We believe when they do, North Carolina will be a very strong competitor to locate their captive.
We understand that this is a competitive environment, however, we are ready. As stated earlier, there are no fees in the proposed law. The law also does not require the state to perform audits at stated intervals, and in fact consideration can also be given to waiving the audit requirement under certain circumstances. The premium tax structure is competitive. North Carolina clearly understands that it is to a great degree about service and commitment and we believe that we will be able to demonstrate both.
How does the NCCIA plan to market North Carolina to attract captive business?
Adams: Over the next year, NCCIA will ramp up its efforts to attract members by offering seminars and an annual conference/exhibition. We will also participate as presenters at annual meetings of other trade associations. We also expect outreach efforts from the North Carolina Department of Insurance
