RISK& INSURANCE
April 2012 ®
2012
Vermont
Laura Zehm,
vice president and CFO, Community Hospital of the Monterey Peninsula
A Picture of Captive Health Why health care companies seek shelter in Vermont.
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RISK& INSURANCE
®
www.riskandinsurance.com
APRIL 2012 | vol. 23 no. 3
contents cover story
A4
A Picture of Captive Health
Two new Vermont captives talk about their journeys from concept to formation, revealing the foundations behind the domicile’s continued success. BY MATTHEW BRODSKY COVER PHOTO BY Paul Schraub
A14 Seeking Shelter In Vermont, risk retention groups insure all forms of risk, from risks facing colleges and universities, to risk facing primary care doctors and specialists, and even to insurance agents. BY Matthew Brodsky
A10 RRGs Still RSVP for
Their Spot in Vermont Risk retention groups have always found a special place in the Vermont domicile, and continue to do so today no matter what challenges they face.
A16
Number of new captives licensed in Vermont in 2011
A18
Number of captives by size, type and industry sector in 2011
A19
Number of active and dissolved captives in 2011
BY Matthew Brodsky
A P R I L 2012
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A
Picture
of Captive
Health
laura Zehm, vice president and CFO of Community Hospital of the Monterey Peninsula. After months of research, the hospital decided to set up a
captive in Vermont. More health care companies are choosing the domicile as a place for their captive.
Two new Vermont captive owners talk about their journeys from concept to formation, revealing the foundations behind the domicile’s continued success. BY MATTHEW BRODSKY It was something nearly two years in coming. At the beginning, there was a hospital, Community Hospital of the Monterey Peninsula, and the many employers that sent their injured and ill employees its way. These employers were asking, pleading, for ways to reduce their health care benefits costs. The hospital had an answer for its own costs. As Laura Zehm, vice president and CFO explains, the hospital was able to reduce its own budget by $44 million. Yet,
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risk & insurance®
even while reducing its own costs, the hospital couldn’t pass down savings to local businesses in terms of cheaper health care provided to employees. “These savings to health care costs did not benefit local employers as much as it benefited insurance plans,” Zehm said. That didn’t deter Zehm. She was determined to help her neighbors. As surfers say, “Locals rule.” So nearly two years ago, Zehm began weighing options. One idea
was a self-insured group formed of employers who would share stoploss coverage. Further research and thought was put into it. It took awhile, Zehm confesses, to uncover the right people to discuss the situation with. In this case, she spoke with the head of a risk pool to which the hospital belonged. He recommended she speak with folks at Willis. She also attended industry events about the self-insurance marketplace. A captive emerged as the solution. Other stop-loss captives were already active and successful. And with a group captive, employers could band together to reduce administrative costs and save on premiums, which would otherwise
particularly stringent? It became a nine-month process, educating herself about captives and health care regulations in the Golden State and discussing the intricacies with attorneys. Other hospitals were kind
go to the traditional insurance market as profits. It was an argument that Zehm figured would be easy to make to employers. “We’re going to save money for you from day one,” she would tell them. The other benefit would be loss control, or in this specific case, employers working with their employees to help them be healthier. “It’s much more than just the insurance side. It’s also the risk management side,” Zehm said. But there were two important questions Zehm had to answer before launching a captive. Was a stop-loss group captive legal in California, where restrictions surrounding employee benefits are
Mutual Insurance Co., was formed and active. For the Archdiocese of New Orleans, the process went a bit quicker. The captive went live on July 1, 2011, after months of research and preparatory effort. “I didn’t want to go The result was to a state that wasn’t similar though: a captive formed experienced with captives. successfully with Vermont was a clear high expectations winner.” ... and in a Vermont —Laura Zehm, vice president and CFO, domicile. “We decided to Community Hospital of the Monterey Peninsula do it in Vermont enough to share data. Zehm and her because they have a track record,” team built out a business plan. said Jeff Entwisle, chief operating This effort made the second officer of the Archdiocese and question seem easy: Where director of its new captive, should Community Hospital of the Archdiocese of New Orleans Monterey Peninsula domicile its new Indemnity Inc. “They’re good at it, captive? they’re efficient with it, they know The hospital’s captive consultants what they’re doing,” he said about at Willis had helped them apply a the Vermont regulators. “scoring system” to determine which Entwisle stressed one of the other jurisdiction best suited its needs, factors that Zehm mentioned: how taking into consideration factors easy the Vermont regulators are to such as taxes and other costs. The work with. It helped too that Kane, top scorer? Vermont. the captive management company The answer made sense to Zehm. that set up the Archdiocese’s “I didn’t want to go to a state that pure captive, also had a history of wasn’t experienced with captives,” successful captive formation in the the CFO said. “Vermont was a clear state. winner.” Vermont came up during New A scoring system, though, was Orleans Archdiocese’s initial not all that should go into choosing a research as well when they studied home for a captive. In August, Zehm how the Archdiocese of New York traveled to Burlington for the annual had established its captive, which conference of the Vermont Captive is domiciled in the Green Mountain Insurance Association. The purpose state. New York has had good results, was to meet regulators “eyeball to the COO said, so they have used eyeball.” their peers there as a model. New Zehm appreciated how positively York proved it was possible, and New the regulators reacted to her Orleans completed more actuarial presentation, validating all of the work to ensure it would work for its effort and research she had put into needs. her business plan. She was won over Now with the captive operational by how approachable Vermont’s within months, the Archdiocese regulators were. “They are real people you can sit Summary down and talk with,” she said. The next step in the process—the • Vermont scored high on a scouting licensing and application process— “report card” by the Community was not onerous but smooth, given Hospital of the Monterey Peninsula. the fair and experienced approach • When the New Orleans of the regulators and the homework Archdiocese was looking to set up Zehm already put into the captive’s a captive, it was reassured by the business plan. By the end of 2011, results of the New York Archdiocese, which had a Vermont captive. the hospital’s stop-loss group captive, the Central Coast Community
A P RI L 2 0 1 2
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of New Orleans is set to reap its most desired rewards: a bolstered risk management program. Sure, Entwisle said, with the captive essentially providing its self-insured retention for liability, sexual misconduct, auto, workers’ comp and property, saving on insurance rates is also a factor. “We’ve taken on more of the risk ourselves and made it a point to get the message out to all of our decision-makers on the local level, and let them know that risk management is the vehicle that will make the captive perform well,” Entwisle said. “We’re encouraged by the results so far,” he adds.
ENCOURAGING RESULTS
Besides the Archdiocese of New Orleans and Community Hospital of the Monterey Peninsula, 39 other parent companies launched captives in Vermont in 2011. Forty-one is a solid number, even surprising to some.
“We decided to do it in Vermont because they have a track record.” —Jeff Entwisle, director, Archdiocese of New Orleans Indemnity Inc. Yet for professionals who are veterans to the industry, it makes perfect sense that Vermont continues to attract a torrent of quality captives. As Tom Jones, partner in the law firm of McDermott Will & Emery LLP in Chicago, explained point by point, Vermont features a solid law that gets updated
as needed (the recent inclusion of incorporated cells an example), an infrastructure of service providers, and knowledgeable and flexible regulators that have earned respect in the industry. The domicile as a whole represents a “repository of captive knowledge that they accumulated
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over the last 25 years,” Jones said, also describing it as “momentum.” Whether a parent company is for-profit or nonprofit, whatever the sector, he said, “Vermont has all the options.” Vermont is particularly attractive to parent companies looking to launch a serious captive. “If you want to go into captives in a big way, Vermont is the place to do it,” said Les Boughner, executive vice president at Willis, citing Vermont’s reputation, regulatory standards and “critical mass” of accountants, managers, investment firms and other service providers. Dan Towle, director of financial services for the state of Vermont, added: “It is important for companies to conduct proper duediligence when exploring domicile options. Choosing the appropriate domicile is important to the overall success of the captive.”
“If you want to go into captives in a big way, Vermont is the place to do it.” —Les Boughner, executive vice president, Willis As for the coming year, signs point to another solid year. “We expect captive formation to be strong again in 2012 in Vermont,” Towle said. “The general uncertainty in the market and the proven track record of Vermont keeps us at the forefront of jurisdictions to domicile your captive.” Vermont will benefit from all of the positives mentioned above of course, as well as a “rising tide” in the captive industry in general, according to Jones. Boughner at Willis agrees. “We continue to experience a
The hospital’s captive consultants at Willis had helped them apply a “scoring system” to determine which jurisdiction best suited its needs, taking into consideration factors such as taxes and other costs. The top scorer? Vermont.
The interior of a hospital. Vermont captive insurance officials have seen an increase in the
number of health care companies setting up captive companies in Vermont.
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tremendous amount of interest around captives.” “It’s being viewed as much more a strategic tool than a reactive tool,” he said of a captive. “Consequently companies are forming captives that are not particularly active anticipating market change or looking at other ways to use captives, including terrorist coverage.” Another positive growth sign, according to Nancy Gray, regional managing director of captive and insurance management for Aon Global Risk Consulting-Americas, is that the trend of captive dissolution is returning to historic levels. During the height of the economic crisis in 2009, she said, some parent companies looked to save costs by consolidating multiple captives, for instance, those acquired during M&A activity. This activity peaked in 2010. Gray suggests that writing employee benefits in captives continues to be explored by companies. In addition, the life insurance company triple-X captive is driving new formations in Vermont, as Vermont continues to grow its market share by proving itself more able to provide timely and fair regulatory and licensing services. “Medical stop-loss is popular as well,” Gray said. Which brings us back to Community Hospital of the Monterey Peninsula and its CFO Zehm, who is optimistic about 2012. She foresees at least three new local employers joining the group captive that she entrusted with Vermont. MATTHEW BRODSKY, a former editor of Risk & Insurance®, is editor in chief of Wharton Magazine.
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captive com
RRG’s Still
RSVP for their Spot in
Vermont Risk retention groups have always found a special place in the Vermont domicile, and continue to do so today no matter what challenges they face. By MATTHEW BRODSKY
Six new risk retention groups formed in the Vermont captive domicile in 2011. If you do the math, that means that the number of risk retention groups in the state increased 7.2 percent over 2010, from 83 to 89 in number. Out of the captive Class of 2011, RRGs make up nearly one out of
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every seven new captive formations. Out of the entire 590 active captives in Vermont, risk retention groups make up an even greater percentage, 15 percent. This occurred in the state where in 2010, already one in three RRGs (out of a national total of 249) was housed. Numbers do not lie, but neither
do the owners of those risk retention groups, from both large and small groups, who continue to be content members of the Vermont domicile. One such happy customer is Janice M. Abraham, president and CEO of United Educators. “Vermont, where United Educators is domiciled, has a welldeveloped, seasoned and stringent regulatory process in place with excellent people in the insurance
department overseeing risk retention groups,” she told Risk & Insurance® in an email. “We believe that Vermont represents the ‘gold standard’ for oversight and regulation of captives, including risk retention groups.” Yes, the “gold standard” label still sticks, in particular with risk retention groups and the state’s regulatory environment. “Although they are very business friendly, I always felt that they do have their standards,” said Richard Cornelius of the Indiana Risk Retention Group. Tim Padovese, president and CEO of Ophthalmic Mutual Insurance Co., claimed authorship of one of the most oft expressed praises for Vermont captive regulators: “Years ago, I said that Vermont is firm but they’re fair,” he said. Talk to any active risk retention group, and they will exclaim how they have a “great relationship” with the regulators in Vermont, as Rich McCarthy, CEO of American Land Title Association, put it. When American Land Title started in 1988 in Vermont, McCarthy said, no other serious onshore domicile existed for what his company was looking to do. And part of the reason was the accessibility and earnestness of not just the regulators, but the legislature and the governorship, no matter their political affiliation. McCarthy recalled a time he was sitting in the office of then governor Howard Dean, a Democrat. Dean was telling McCarthy to call him anytime he needed anything. Look me up, I’m in the book, was about how Dean exclaimed it. When McCarthy got back to his office, he looked in the white pages, and
“Those working in RRGs spend time and effort to creatively and innovatively service a specific industry and/or a homogenous group.” —Dan Labrie, CEO, Housing Authority Insurance Group indeed, Dean was in the book. “That’s how receptive they are to us,” McCarthy said. What made McCarthy’s decision to house American Land Title in Vermont easy back in 1988, and still today, is the universe of service providers and other captive owners in the state. As for the infrastructure of service providers, Cornelius cites the captive managers, law firms, accountants and other service providers that form a core community in the Green Mountain State, as well as the risk retention group specialists, like niche auditors, that exist in the state. “I like it that I have 500 friends in Vermont,” McCarthy said about the Vermont Captive Insurance Association and his fellow captive owners. McCarthy praises the Vermont Captive Insurance Association for continuously lobbying in Montpelier for more regulators to be hired because Vermont captives want to be “regulated properly.” The state listens. The captive regulatory staff at last count is 32, all “who can handle the workload involved with monitoring RRGs in compliance with National Association of Insurance Commissioners accreditation standards,” said David Provost, the deputy commissioner for Vermont’s Captive Insurance Division. “That’s our commitment to the industry, and the state’s commitment was clearly demonstrated by our approval to hire four new examiners this year,” he said. Cornelius also gives the VCIA high marks for lobbying inside and outside of Vermont on legislative issues, and on leading the discussion
among its members and among the captive community overall on pressing industry issues. “Whenever an issue comes up, I sense everyone looks to Vermont. Vermont always has a role,” Cornelius said. Provost made sure to stress this point as well, about how his team is involved with National Association of Insurance Commissioners committees and deliberations and how Vermont Captive Insurance Association represents Vermont’s captive community in Washington, D.C., and Montpelier.
FACING THE FUTURE
These reasons help explain why the field of risk retention groups in Vermont is still a healthy and a diverse one. Although risk retention groups are best known for being used by health care-related groups, Vermont has attracted a variety of owners by sector, as Cornelius pointed out. Take the most recent crop. Out of the six new groups in 2011, three are health care related but one is construction related, another religiously affiliated and the third for professional services. Overall, the risk retention niche is as vibrant as ever. “RRGs are, in fact, growing,” Abraham said. In 2005, she said, risk retention
Summary • Nearly one out of every seven
of the 41 new captive formations licensed in Vermont in 2011 was a risk retention group. • Risk retention group experts like Vermont because it has strong regulations and skilled professionals like lawyers and auditors.
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groups wrote about $1.8 billion of commercial liability coverage. That figure increased to $2.5 billion in 2010, or about 3 percent of the total U.S. commercial liability market. And risk retention group business for the most part has solid financial underpinnings. Abraham points to a recent analysis of risk retention groups by the Government Accountability Office, which revealed strong results in average return on equity, surplus and combined ratio from 2004 to 2010. Abraham pointed to two primary reasons why risk retention groups continue to play a critical, albeit niche role in the marketplace. “Unlike traditional carriers, risk retention groups have no incentive to move in and out of markets and therefore provide stability in insurance coverage for their members,” she said about point No. 1. Point No. 2: RRGs are dedicated and specialized for one given industry or group of insureds, so they are able to deliver tailored
coverages and risk management and claims services. “Those working in RRGs spend time and effort to creatively and innovatively service a specific industry and/or a homogenous group,” said Dan Labrie, CEO of Housing Authority Insurance Group, parent company of the Housing Authority Risk Retention Group Inc. As Provost explained: “When members of a group are motivated to reduce the frequency and severity of losses because their own dollars are at risk, and their peers are on the risk retention group board with them, the result is sharpened focus on risk management and loss prevention.” The chief captive regulator added a third reason for the success of risk retention groups: their nimbleness and ability to react to change faster than the traditional insurance market. All of the risk retention group owners interviewed for this piece were as upbeat as Abraham, Labrie
and Provost about the future of this particular flavor of group captives, where members are also the owners of the insurance company. They all also, of course, recognize the challenges facing the industry. Perhaps the top legislative unknown on the horizon are proposed changes to the Liability Risk Retention Act. The captive industry would like to see the original act, passed in 1986, allow risk retention groups to expand into property and commercial auto coverages, versus only the casualty coverages permitted now. Abraham also welcomes the other aspect of the proposed RRG-related legislation, which would require good governance practices and address the attempts of nondomiciliary states to regulate and impose fees upon RRGs that sell insurance in their states. Padovese cited numerous times when other states attempted to govern Ophthalmic Mutual instead of allowing his Vermont regulators
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What growth means to you.
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to do their job. In these instances, Ophthalmic Mutual would go to that state, tell them about the Liability Risk Retention Act and how Ophthalmic Mutual follows Vermont law, and tell them they could get them in touch with Vermont if they had questions. Ophthalmic Mutual has sought legal help to challenge offending states on occasion. On the side of the RRGs was that recent GAO report, which called for Congress to tighten the language in the original Liability Risk Retention Act to clearly define the role of domiciliary and nondomiciliary states. Another development was the recent summary judgment allowed by the judge in Alliance of Nonprofits for Insurance Risk Retention Group v. Nevada, who ruled that the law pre-empts Nevada’s prohibitions against Alliance issuing auto liability insurance. Labrie lists other challenges worth considering: the effects of the economic downturn on RRGs representing particularly hard-hit
“when members of a group are motivated to reduce ... losses ... the result is sharpened focus on risk management and loss prevention.” —David Provost, deputy commissioner, Captive Insurance Division industries, such as construction; the stiffer competition from the traditional market due to soft cycles; and the risk that the veteran staff members of RRGs everywhere will not be replaced with an able, younger generation. Whether the new RRG legislation ever passes the House of Representatives, and how risk retention groups handle all the other risks on the horizon, the RRG marketplace will remain an important part of the captive and overall commercial insurance space.
Part of the reason is Vermont, both as a secure domicile for current and new groups and as a staunch supporter of the industry. “Vermont has a great staff and infrastructure, they understand the purpose of the industry and work well its employees. Without Vermont, Housing Authority Risk Retention Group could not have been as successful,” Labrie said. MATTHEW BRODSKY, a former editor of Risk & Insurance®, is editor in chief of Wharton Magazine.
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Seeking Shelter In Vermont risk retention groups insure all forms of risk, from risks facing colleges and universities, to risks facing primary care doctors and specialists. In the Green Mountains, risk retention groups large and small protect markets from risks of all kinds. Here is a sample of the variety of risk retention groups seeking advantages provided by Vermont.
United Educators Why was it formed? Universities, colleges and schools sought to fill a gap left by traditional insurance, to provide stable pricing, clear policy language, broad coverage, and tailored claims and loss-control services. When was it formed? 1987 How big is it? United Educators insures more than 1,200 schools, colleges and universities. Its gross premiums in 2011 totaled $137 million. What coverages does it offer? Primary general liability, excess general liability, educators’ legal liability, other miscellaneous liability, school board legal liability and auto excess liability.
When was it formed? 1987 How big is it? OMIC covers more than 4,400 ophthalmologists in the United States, with $41 million in premium written. What coverages does it offer? Medical professional liability
Housing Authority Risk Retention Group Why was it formed? The public housing community faced a crisis in the mid-1980s. Insurance companies were reluctant to provide coverage. Over time, the company evolved from a single risk retention group into a group of 10 companies that provide a full line of coverage and related services under the umbrella organization, Housing Authority Insurance Group.
Indiana Risk Retention Group Why was it formed? It addressed a hard market and limited availability for medical-malpractice insurance, allowing hospitals to have more say in their insurance purchase, risk management and claims-handling. When was it formed? 2003 How big is it? It insures eight community hospitals in Indiana with a premium base of $5 million. What coverages does it offer? Medical malpractice, professional liability and general liability.
American Land Title Insurance Co. Why was it formed? In the mid-1980s, title insurance agents could not find errors and omissions coverage. The traditional market then wouldn’t participate in a program put together by their trade association. When was it formed? 1988 How big is it? American Land Title has about 2,000 members and writes $7.5 million in premium. What coverages does it offer? Errors & omissions for title insurance agents.
Ophthalmic Mutual Insurance Co. Why was it formed? About 400 ophthalmologists received notice of their policy cancellation and approached the American Academy of Ophthalmology to address the issue sought alternative solutions.
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When was it formed? 1987 How big is it? It provides insurance in the 48 contiguous states and the District of Columbia. It generates nearly $35 million in premiums, has more than 800 member housing authorities, and insures more than 750,000 family and senior units and provides contingent liability insurance on over 500,000 Section 8 units. What coverages does it offer? Housing Authority Risk Retention Group offers general liability written on an occurrence form. In addition, it offers public officials errors and omissions liability, law enforcement liability; employment practices liability insurance; public officials liability; mold; lead liability; and lead-based paint liability insurance on a claims-made basis. Coverage is also available for primary nonowned and hired auto liability, and auto liability. —Compiled by Matthew Brodsky
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New Captives In 2011 Company Name
Date Licensed Type Manager
Sportsman’s Insurance Company, Inc.
1/31/11
Pure
Willis
Gables Risk Retention Group, Inc.
2/24/11
Rrg
Marsh
Saturn Insurance Inc.
3/25/11
Pure
Willis
U.S. Fire & Indemnity Company
3/23/11
Pure
Beecher
The Attorney Professional Exchange Rrg, Inc.
3/25/11
Rrg
Ics
Raven Reinsurance Company
3/30/11
Pure (Spfc)
Marsh
Dorintal Reinsurance Limited
3/30/11
Pure
Marsh
Vgi Insurance, Inc.
4/27/11
Pure
Srs
Buckeye Assurance Corporation
5/13/11
Pure
Marsh
Scholar Reinsurance Company, Inc.
6/10/11
Pure
Marsh
Archdiocese Of New Orleans Indemnity, Inc.
6/28/11
Pure
Kane
Berkeley Re Limited
6/21/11
Pure (Branch)
Aon
Fifty Ninth Street Insurance Company, Llc
6/21/11
Pure
Willis
Dynamo Insurance Company, Inc.
6/22/11
Pure
Beecher
Aviva Re Usa Iii, Inc.
6/28/11
Pure (Spfc)
Marsh
Ipic Reinsurance Company
6/30/11
Pure
Aon
Sig Insurance Company
7/15/11
Pure
Towner
Lca Insurance Co., Inc.
7/15/11
Pure
Marsh
The Catholic Relief Insurance Co. Of America Ii
7/15/11
Sponsored
Aon
8/2/11
Sponsored
Kane
8/12/11
Pure
Marsh
8/2/11
Pure
Artex
Kane (Vermont) Scc, Inc. Uch Assurance Company, Llc United Methodist Insurance Company, Inc. Lincoln Reinsurance Company Of Vermont Iii
8/15/11
Pure (Spfc)
Marsh
Ncmic Risk Retention Group, Inc.
8/19/11
Rrg
Towner
Western Catholic Insurance Company Rrg, Inc.
9/16/11
Rrg Artex
Sbli Vt Re, Llc
9/28/11
Pure (Spfc)
Marsh
Lincoln Reinsurance Company Of Vermont Iv
10/4/11
Pure (Spfc)
Marsh
I.V.C. Insurance Inc.
10/17/11
Pure
Willis
Pacific Alliance Excess Reinsurance Company
11/10/11
Pure
Marsh
Restoration Risk Retention Group, Inc.
11/10/11
Rrg
Risk Services
Primetime Reinsurance Company, Inc.
11/18/11
Pure (Spfc)
Marsh
Ahrma Exchange
11/28/11
Association
Wilmington
Industrial Insured
Willis
Central Coast Community Mutual Ins. Co.
12/5/11
Blue Leaf Insurance Company
12/13/11
Pure
Marsh
Aviva Re Usa Iv, Inc.
12/13/11
Pure (Spfc)
Marsh
Miia Reinsurance Company
12/13/11
Pure
Srs
First British Vermont Reinsurance Company Ii
12/13/11
Pure (Spfc)
Marsh
Aviva Re Usa V, Inc.
12/13/11
Pure (Spfc)
Marsh
Wachovia Re, Inc.
12/20/11
Pure
Aon
Faith-Affiliated Risk Retention Group
12/22/11
Rrg
Aon
Cooperative Partnership Insurance Company
12/28/11
Sponsored
Chartis
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r i s k & i n s u r a n c e ®®
Parent Co. Ultimate Parent
Industry
Bass Pro, Inc.
Bass Pro Group Llc Retail
Dr. Perez & Dr. Tano, Kidz Medical Service
N/A
Bp America Inc.
Bp Holdings North America Ltd/Bp Plc Energy
Healthcare
Weingarten Investments, Inc.
Weingarten Realty Investors, Inc.
Real Estate
New York Law Firms And/Or Partners
N/A
Professional Service
Om Financial Life Insurance Company
Harbinger Om, Llc Insurance
Liana Limited (Holding Co.)
Dow Chemical Company
Manufacturing
Goliath, Inc.
Vanguard Group, Inc., The
Securities
Marathon Petroleum Corporation
N/A
Energy
New York Schools Insurance Reciprocal
New York School District Subscribers
Education
7887 Walmsley, Inc.
Archdiocese Of New Orleans
Religious Institution
Kraft Foods, Inc.
N/A
Manufacturing
Alexanders, Inc.
N/A
Real Estate
Cummins, Inc.
N/A
Energy
Aviva Life & Annuity Company
Aviva Plc Insurance
Bank Of America Corporation
N/A
Securities
Spirol International Holding Corporation
N/A
Manufacturing
Walgreen Co.
N/A
Healthcare
Catholic Relief Insurance Co. Of America
Catholic Mutual Relief Society Of America
Religious Institution
Kane (Usa) Inc.
The Kane Group
Insurance
United Church Homes, Inc.
N/A
Healthcare
Gcfa Of The United Methodist Church
N/A
Religious Institution
Lincoln National Life Insurance Company
Lincoln National Corporation
Insurance
Doctors Of Chiropractic
N/A
Healthcare
N/A
Religious Institution
The Savings Bank Life Insurance Co. Of Mass.
N/A
Insurance
Lincoln National Life Insurance Company
Lincoln National Corporation
Insurance
I.V.C. Holdings, Inc.
I.V.C. Industrial Coatings, Inc.
Manufacturing
Pacific Lifecorp
Pacific Mutual Holding Company
Insurance
Servpro Industries, Inc. & Franchises
N/A
Other
Citicorp Banking Corporation
Citigroup, Inc.
Insurance
Assisted Housing Risk Management Assoc.
N/A
Nonprofit Or Municipality
Community Hospital Of The Monterey Peninsula
N/A
Healthcare
Cnh America Llc
Cnh Global N.V.
Manufacturing
Aviva Life & Annuity Company
Aviva Plc Insurance
Miia Property & Casualty Group, Inc.
N/A
Banner Life Insurance Company
Legal & General Group Plc Insurance
Aviva Life & Annuity Company
Aviva Plc Insurance
Wells Fargo Bank, Na
Wells Fargo & Company
Banking
Faith-Affiliated Facilities Association
N/A
Healthcare
Charter Partners Risk Services, Inc.
N/A
Other
Ca And Az Roman Catholic Dioceses
Nonprofit Or Municipality
AA PP RI RI LL 22 00 11 22
A17 A17
NUMBER & TYPE OF CAPTIVES BY GROSS PREMIUM WRITTEN Based on 12/31/10 Gross Premium Written INDUSTRIAL PURE TOTAL ASSOCIATION INSURED PURE (BRANCH) (SPFC) RRG SPONSORED Less than $1 million
156
1
8
121
1
1
15
9
$1 - $5 million
139
5
6
97
2
0
25
4
$5 - $10 million
70
2
3
42
0
1
20
2
$10 - $50 million
115
3
5
82
1
5
17
2
$50 - $100 million
27
0
0
20
0
5
2
0
$100 - $500 million
32
0
2
18
0
8
4
0
over $500 million
10
0
0
4
0
6
0
0
549 11
Licensed in 2011 Total
24 384 4 26 83 17
41
1
1
20
1
9
6
3
590
12
25
404
5
35
89
20
Source: Vermont Department of Banking, Insurance, Securities and Health Care Administration
NUMBER OF CAPTIVES BY INDUSTRY Total at 12/31/11 AGRICULTURE 3 BANKING 48 COMMUNICATIONS 10 CONSTRUCTION 32 EDUCATION 18 ENERGY 25 ENTERTAINMENT 10 FINANCING, Lending, Leasing 6 HEALTHCARE 94 HOTELS 5 INSURANCE 63 MANUFACTURING 103 MEDIA 5 NONPROFIT OR MUNICIPALITY
13
OTHER 10 PROFESSIONAL SERVICE
35
REAL ESTATE
20
RELIGIOUS INSTITUTIONS
18
RETAIL 28 SECURITIES 11 TECHNOLOGY 6 TRANSPORTATION 24 WASTE MANAGEMENT
3
Total 590 A18
risk & insurance®
Source: Vermont Department of Banking, Insurance, Securities and Health Care Administration
12/31/11 12/31/10 2011
Company Status: Active VERMONT CAPTIVE Association 12 12 0 Industrial Insured 25 24 1 INSURANCE COMPANIES Pure 404 402 2 LICENSE SUMMARY Pure (Branch) 4 5 -1 Pure (Spfc) 34 25 9 RRG 90 85 5 Sponsored 20 18 2 12/31/11 Licensed In Current Year Sponsored (Spfc) 1 1 0 Association 1 Total Active 590 572 18 Industrial Insured 1 Pure 20 Company Status: Dissolved Pure (Branch) 1 Association 18 17 1 Pure (spfc) 9 Industrial Insured 18 18 0 Rrg 6 Pure 267 249 18 Sponsored 3 Pure (Branch) 3 1 2 Sponsored (spfc) 0 2 2 0 Pure (Spfc) RRG 44 43 1 Total Licensed 41 Sponsored 10 9 1 Sponsored (Spfc) 0 0 0 Source: Vermont Department of Banking, Insurance, Securities and Health Care Administration
Total Dissolved Total Licenses Issued
362 952
339 911
23 41
Save the Date for VCIA! Learn new tools to help you in ‘Making the Right Call’ for your captive or captive-related business! Targeted sessions to give insight into healthcare, federal legislation, regulation & risk management
Vermont Captives:
Making the Right Call!
Many captive owner panelists and case studies More seminars than ever, of varied formats & lengths Top-notch education with CPE / CLE credit and as much networking as you can pack into three days Two Keynote Speakers: Dr. David P. Kelly, Chief Market Strategist, J.P. Morgan Funds & Ed Hochuli, one of the most respected officials in the NFL
VCIA 27th Annual Conference August 7 - 9, 2012 Burlington, VT
Sponsorships available!
www.vcia.com
Online registration starts May 1 RandIVermontEdition2012blue.indd 1
3/13/2012 11:19:39 AM A P RI L 2 0 1 2
A19
the responsibility of individual companies. If one company has
member. Larger, less predictable claims
for that policy year; any excess is billed to the members.
r
in vermont, the course to establishing a captive business is easy. it’s our other courses that aren’t.
.
s
Country Club of Vermont
When companies explore captive insurance to manage risk, more often than not the course will lead to Vermont. And once here, they find the most knowledgeable captive experts in the world, a flexible regulatory environment, and some other courses — the kind with a dogleg here and a strategically placed bunker there. Find out why we think Vermont will suit you to a tee by visiting us at: www.vermontcaptive.com
AUGUST 2007
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