Senate Bill 1038 Summary

• Captive insurance companies may apply for licenses to insure various types of losses including life, health, and commercial risk insurance, and may now accept or transfer risk through parametric contracts (payments triggered by specified events without proof of loss).

• Pure captive companies may only insure parent and affiliated companies; association captives only insure their members and affiliates; industrial insured captives only insure participating industrial insureds and their affiliates.

• Captive insurance companies are prohibited from providing personal risk insurance for private passenger motor vehicles or homeowners insurance coverage.

• Sponsored captive insurance companies may establish protected cells with separate accounting; each cell's liabilities cannot be charged against other cells' assets without commissioner approval, and participant contracts require prior written commissioner approval.

• Protected cells within sponsored captives may establish separate investment accounts for specific participants with segregated income and gains; dormant captive insurance companies are exempt from state premium taxes under section 38a-91nn.