§431:19-104  Minimum capital and surplus. 

(a)  Each captive insurance company licensed pursuant to this article shall

possess and thereafter maintain unimpaired capital and surplus in the amount

established by the commissioner; provided that:

     (1)  The commissioner shall take into account the

nature and volume of business transacted by each captive insurance company, and

any other factors deemed appropriate by the commissioner;

     (2)  Class 3 companies shall be subject to other

applicable provisions of this chapter that may require capital and surplus in

excess of those established by the commissioner; and

     (3)  Minimum capital and surplus established by the

commissioner shall be no less than the following amounts:

         (A)  Class 1 company:  $100,000;

         (B)  Class 2 company:  $250,000;

         (C)  Class 3 company:  $500,000;

         (D)  Class 4 company:  $500,000; and

         (E)  Class 5 company:  An amount as determined

by the commissioner on a case by case basis.

     (b)  Minimum required capital and surplus

established by the commissioner pursuant to subsection (a) shall be in any one

or combination of the following forms: cash, irrevocable letter of credit

issued by a bank chartered by this State or a member bank of the Federal

Reserve System, public obligations as defined in section 431:6-301, or other

form approved by the commissioner; provided that minimum required capital and

surplus in excess of the amounts listed in subsection (a)(3) shall be allowed

to be invested in accordance with a strategic investment policy adopted and monitored

by the captive insurance company’s governing body, and approved by the

commissioner.

     (c)  In the case of a branch captive insurance

company, and in lieu of minimum capital and surplus under this section, the

commissioner shall determine the amount and form of security to be maintained

by the branch captive insurance company in this State after taking into

consideration:

     (1)  The amount and nature of risk written through and

retained by the branch captive insurance company in this State;

     (2)  The financial condition of the outside captive

insurance company whose branch office is located in this State;

     (3)  Trusts or other security posted for ceding

insurers; and

     (4)  Any other factors the commissioner deems

appropriate.

The security required by the commissioner may be in

the form of cash, an irrevocable letter of credit issued by a bank chartered in

this State or a member bank of the Federal Reserve System, a trust, public

obligations as defined in section 431:6-301, or any other forms of security deemed

appropriate by the commissioner. [L 1987, c 347, pt of §2; am L 1998, c 150,

§4; am L 1999, c 302, §3; am L 2000, c 36, §4 and c 133, §4; am L 2003, c 209,

§3; am L 2007, c 232, §6; am L 2008, c 190, §5; am L 2012, c 253, §10]