For Immediate Release: June 27, 2018

Contact: Barry Smith at 919-807-6014

Commissioner Causey announces that captive insurance program provided a $30 million boost to N.C. economy in 2017

RALEIGH -- North Carolina Insurance Commissioner Mike Causey today announced that North Carolina’s flourishing captive insurance program had an estimated $30 million impact on the state last year.

“North Carolina’s captive insurance law, while providing for appropriate regulation, allows companies to form and operate their own insurance companies without getting tangled up in unnecessary red tape,” Commissioner Causey said. “Other businesses and organizations may want to check out our business-friendly environment and form or relocate their own captive insurance company in North Carolina.”

Captive insurance is a form of self-insurance through which a business may form its own insurance company to manage its risks.

There are many reasons why captive insurance may be beneficial to a business. These include the ability to obtain insurance coverage that is not readily available or is too costly in the commercial market, reduction of insurance costs, stabilized pricing, and customization of the terms and conditions of insurance products to meet the insured’s needs.

The $30 million estimate comes from a recently completed study by the N.C. Department of Insurance on the economic impact of the state’s captive insurance company program. The impact was generated by premium taxes paid to the state by licensed captive insurers as well as service provider and hospitality revenues generated by North Carolina businesses for services they provide to the captive insurance industry.

North Carolina’s law requires captive insurance companies domiciled in the state to either hold one board of directors meeting in the state or use at least two North Carolina service providers, such as CPAs, attorneys, or actuaries, thus generating an economic impact in the state.

North Carolina’s captive insurance program has grown since its inception in 2013. The amount that the program has impacted the state’s economy has also increased annually.

The 2017 impact of $30 million is significantly greater than the 2016 economic impact of $23 million, the 2015 economic impact of $15.3 million, and the 2014 economic impact of $2.5 million. That’s nearly a $71 million impact in the four years since the N.C. General Assembly established the captive insurance program.

In other news regarding the state’s captive insurance program:

The N.C. Department of Insurance will also have an exhibit at the conference. Team members will be available for meetings with anyone wanting to discuss the state’s captive insurance program. For more information on the conference, go to:  http://nccia.org/2018-nccia-conference-schedule/.

Learn more about the N.C. captive insurance program at www.nccaptives.com.

--NCDOI--