The Vermont Statutes Online
Banking and Insurance
CAPTIVE INSURANCE COMPANIES
(a) Any captive
insurance company may provide reinsurance, comprised in subsection 3301(a) of
this title, on risks ceded by any other insurer, and may provide reinsurance of
annuity contracts as defined in section 3717 of this title that are granted by
any other insurer.
(b) Any captive
insurance company may take credit for the reinsurance of risks or portions of
risks ceded to reinsurers complying with the provisions of subsections 3634a(a)
through (f) of this title. Prior approval of the Commissioner shall be required
for ceding or taking credit for the reinsurance of risks or portions of risks
ceded to reinsurers not complying with subsections 3634a(a) through (f) of this
title, except for business written by an alien captive insurance company
outside the United States.
(c) In addition
to reinsurers authorized under the provisions of section 3634a of this title, a
captive insurance company may take credit for the reinsurance of risks or
portions of risks ceded to a pool, exchange, or association acting as a
reinsurer which has been authorized by the Commissioner. The Commissioner may
require any other documents, financial information, or other evidence that such
a pool, exchange, or association will be able to provide adequate security for
its financial obligations. The Commissioner may deny authorization or impose
any limitations on the activities of a reinsurance pool, exchange, or
association that, in the Commissioner's judgment, are necessary and proper to
provide adequate security for the ceding captive insurance company and for the
protection and consequent benefit of the public at large.
(d) For all
purposes of this chapter, insurance by a captive insurance company of any
workers' compensation qualified self-insured plan of its parent and affiliates
shall be deemed to be reinsurance. (Added 1981, No. 28; 1985, No. 170 (Adj.
Sess.), § 1, eff. May 7, 1986; amended 1987, No. 168 (Adj. Sess.), § 3, eff.
May 3, 1988; 1991, No. 249 (Adj. Sess.), § 24; 93, No. 40, §§ 7, 8, eff. June
3, 1993; 1999, No. 38, § 13, eff. May 20, 1999; 2003, No. 55, § 7; 2005, No.
122 (Adj. Sess.), § 4.)