HB 610 Summary

• Establishes a new type of captive insurance company called "sponsored captive insurance companies" that can be formed with capital provided by one or more sponsors to insure risks of multiple participants through separate protected cells.

• Requires sponsored captive insurance companies to maintain minimum capital and surplus of $500,000 and allows them to be incorporated as stock insurers, mutual corporations, nonprofit corporations, or manager-managed limited liability companies.

• Permits sponsored captive insurance companies to establish protected cells (separate accounts) for individual participants, with each cell's assets segregated and not chargeable with liabilities from other cells or the company's general business.

• Sets premium tax rates for sponsored captive insurance companies at a minimum of $7,500 annually (applied to the company as a whole, not individual cells) with a maximum tax calculated per protected cell.

• Requires director approval for participant contracts, establishment of protected cells, and withdrawal of participants; mandates that each protected cell maintain separate financial accounting and may require business to be fronted, reinsured, or secured by trust funds or letters of credit.