July 21, 2009
New state insurance law encourages companies to bring captive operations back to Missouri
Jefferson City, Mo. - Gov. Jay Nixon has signed a bill that makes improvements to the state's captive insurance laws by simplifying the process of moving offshore captive operations to Missouri. House Bill 577, an omnibus insurance bill, makes it easier for Missouri companies to bring their captive operations back to the state by removing certain financial restrictions and clarifying provisions on alien redomestication. The bill may also make it attractive for companies based outside Missouri to set up captive operations here.
"Because of our central location, Missouri is seen as an ideal spot for companies across the country to locate a captive operation," said John M. Huff, director of the Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP). "With this new legislation, Missouri is opening its doors even wider for companies who want to relocate their captive operations here."
Among the provisions of the new law:
- Specific allowance of alien redomestication, which makes the process as simple as redomestication of a U.S.-based insurer.
- Allows for reciprocal formations to accommodate the return of offshore not-for-profit groups.
- Removes a requirement for mandatory investment in Missouri, to accommodate companies with existing banking relationships.
- Allows additional options for admittance of available credit as assets for Special Purpose Life Reinsurance Captives.
- Reduces the number of resident incorporators for Special Purpose Life Reinsurance Captives from two to one.
- Mandates a portion of all captive premium tax to be allocated for department's captive operations, helping to ensure the long-term viability of the DIFP's program.
Huff says the new law is a direct response to the current economic climate, in which captives have had trouble finding credit, which is vital to effectively operate their business.
Companies interested in bringing captive operations to Missouri can contact John Rehagen, DIFP Captive Program manager, at 573-522-2563 or visit insurance.mo.gov.
About the Missouri Department of Insurance, Financial Institutions & Professional Registration
The Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP) is responsible for consumer protection through the regulation of financial industries and professionals. The department's seven divisions work to enforce state regulations both efficiently and effectively while encouraging a competitive environment for industries and professions to ensure consumers have access to quality products.