November 18, 2009
Major foodservice industry player sets up captive insurance company in Missouri
Jefferson City, Mo. - A leader in the U.S. foodservices market has become licensed as a captive insurance company by the Missouri Department of Insurance, thanks to a new state law making the captive formation process easier. The department announced it has licensed a subsidiary of Ralcorp Holdings Inc. as a pure captive, just two months after the new law took effect.
A pure captive insurance company is utilized to insure some of the risks of its owner and subsidiaries. Ralcorp Holdings Inc., a St. Louis-based company, is a leading producer of private-label (or store-brand) foods and a major producer of foodservice products.
"Missouri is a great place to work and do business, and we are pleased to welcome Ralcorp to the ranks of companies with captives in Missouri," said John M. Huff, director of the Department of Insurance, Financial Institutions and Professional Registration (DIFP). "Captive insurance companies have a positive impact on the state's economy by reducing costs for businesses while keeping tax revenue for the state and creating jobs."
Gov. Jay Nixon in July signed HB577, which simplified the process of moving offshore captive operations to Missouri. The 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 law also makes it more attractive for companies based outside Missouri to set up captive operations here.
Since the law's passage, the department has seen an increased interest in captive formations to Missouri from companies across the country. Department officials are in discussions with several other companies considering establishing captive insurance companies in the state.
The captive insurance program in Missouri has seen solid growth since the original legislation authorizing captive formation in August of 2007. Premium written by Missouri captive insurance companies has increased from $30 million in 2007 to $123 million in 2008 and is anticipated to reach approximately $1 billion by the end of 2009.
Companies interested in bringing captive operations to Missouri can contact John Rehagen, DIFP Captive Program Manager, at 573-522-2563 or visit the department's Web site.
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.