Tennessee Captive Industry Sets Record Growth in 2016
Tennessee’s captive insurance market saw a record annual total of 104 risk bearing entities (RBEs) added in 2016, according to data released by the Tennessee Department of Commerce & Insurance (TDCI).
The new captives are comprised of 30 pure captives, five protected cell companies, one association captive, one risk retention group, and 67 new protected cells.
Nine of the newly added captives are redomestications to Tennessee from other leading domestic and international domiciles.
A captive insurance company represents an option for many corporations and groups wanting to take financial control and manage risks by underwriting their own insurance. TDCI’s Insurance Division is responsible for properly regulating Tennessee’s captive insurance industry.
In 2011, Governor Bill Haslam signed the revised State of Tennessee’s Captive Statute which made the state’s existing captive insurance laws more effective, balanced and flexible.
The number of new formations in 2016 brings the state’s total to 159 captive insurance companies and 379 protected cells formed, for a total of 538 RBEs.
“We are proud of the progress made last year to expand Tennessee’s captive insurance market,” said TDCI Commissioner Julie Mix McPeak. “Forming over 100 risk bearing entities in 2016 and over 500 entities in five years is quite a feat. TDCI remains committed to its role of maintaining proper regulation of captive insurance in Tennessee.”
According to an internal economic development survey conducted in the summer of 2016, the captive insurance industry has brought 82 new full-time jobs to Tennessee and over $430 million in direct and indirect spending and capital investment to the state.
“The redomestication of nine captive insurance companies to our state shows that more and more leaders in this industry are comfortable setting up their captives here,” said TDCI Director of Captive Insurance Michael Corbett. “We especially appreciate the efforts of the Tennessee Captive Insurance Association (TCIA) in helping to make this growth happen.”