Delaware General Assembly

Signed 7/12/05

The General Assembly has ended, the current status is the final status.

6/8/05

Stone

Sen. Blevins

AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO CAPTIVE INSURANCE COMPANIES.

Delaware’s captive insurance company statute initially was enacted in 1984. This bill represents the first major revision of the statute and substantially rewrites the current law. The main objective of the legislation is to enhance Delaware’s appeal as a domicile for captive insurance companies. With recent dramatic increases in commercial insurance premiums and greater difficulty in securing access to certain types of insurance coverages, more and more business organizations are turning to captive insurance companies as a risk management tool. Captive insurance companies also allow businesses to gain greater financial control by helping them to secure more stable insurance pricing, reduce expenses, improve cash flow, access tax savings and increase negotiating leverage with commercial insurers. Building on Delaware’s existing reputation for business, including access to Delaware’s highly regarded business entity laws and preeminent court system, the new Delaware Revised Captive Insurance Company Act provides flexibility to captive insurance companies within a tax efficient framework, especially for start-up captive insurance companies, and within an appropriate regulatory context. This legislation will create new opportunities especially for captive insurance companies and those who use them. It also will foster economic development in Delaware, by cultivating the growth of the captive insurance industry in the State.

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Takes effect upon being signed into law

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