VERMONT ISSUES GUIDANCE ON SPECIAL PURPOSE FINANCIAL INSURERS
The Vermont Department of Financial Regulation’s Captive Insurance Division has released a bulletin entitled “Guidance for Special Purpose Financial Insurers” to provide guidance regarding licensing standards and regulatory requirements for Special Purpose Financial Insurance Companies, formerly known in Vermont as “Special Purpose Financial Captives” until legislation mid-last year. With a pronounced goal of “support[ing] the use of appropriate uniform standards for regulation of insurer-owned captives and Special Purpose Financial Insurance Companies and to establish best practices and high standards for their continued use,” the bulletin has an NAIC-esque tone. Among other standards, the bulletin provides a sampling of qualified transactions and then discusses transaction review, reporting, and disclosure procedures that appear to engender significant collaboration between and among interested and/or cedents’ regulators. Vermont’s bulletin comes on the heels of a string of regulator releases addressing the captive insurance market, including releases from the New York Department of Financial Services and NAIC in June and July 2013, respectively, and, most recently, the FIO in December 2013. Vt. Ins. Bulletin No. C-2014-01 (Jan. 27, 2014).
This post written by Kyle Whitehead.
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