naples preshrank: Insurance News - Florida Courts Insurance Companies

By Doreen Hemlock, Sun Sentinel, Fort Lauderdale, Fla.
McClatchy-Tribune Information Services

June 04--Florida is open for business for companies or groups that want to set up units to provide their own insurance.

That was the message Friday, when Gov. Rick Scott joined with business leaders in Miami to tout a new law that encourages these self-insurance companies to set up in the Sunshine State.

Florida today hosts no captive insurers and faces stiff competition for them from dozens of states.

But a new law that takes effect July 1 boosts the state's competitiveness by modernizing rules and lowering capital requirements for captive insurance companies to set up in the state.

"We had antiquated laws, were bureaucratic and only allowed 'industrial' captives," not captive insurance firms for other types of companies or groups that self-insure, said Ivette Arango, a spokeswoman for the Beacon Council, the Miami-Dade economic development group that has championed the new law.

"Now, with the new law, we can compete. The companies can bring jobs to Florida and, by holding meetings here, can help our tourism and convention business," Arango said.

The new law requires captive insurers based in Florida to hold at least one annual board meeting in the state.

Nationwide, the big players in captive insurance are Vermont, Delaware, South Carolina, Hawaii, Missouri, Montana and the District of Columbia, media reports say.

Captive insurers based in those areas help fund government by paying licensing fees and premium taxes. They also create jobs and spend on business services such as managers, consultants and lawyers.

Vermont leads the country in hosting captive insurers, with more than 850 licensed there that handle more than $16 billion in premiums, according to a recent report in Florida Underwriter.

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