CID: News Releases (05/27/2015) - Insurance Commissioner Announces New Captive Insurer in State

{Connecticut Insurance Department}
Insurance Department
Katharine L. Wade
Donna Tommelleo
May 27, 2015

Insurance Commissioner Announces
New Captive Insurer in State 

Insurance Commissioner Katharine L. Wade today announced that a corporation specializing in consultation and financial management for reinsurance companies is expanding its footprint in Connecticut.

New Jersey-based SOBC Corporation is establishing a sponsored captive insurance subsidiary in Connecticut that will specialize in helping reinsurers that are exiting the market pay off their claims. The subsidiary, SOBC Insurance Company Limited becomes the state’s eighth captive insurer and first so-called “sponsored captive” company since the Governor’s 2011 legislation cleared the way for the state to begin licensing these specialty insurers.

The Insurance Department recently licensed the SOBC sponsored captive after an extensive application process.

“A business plan for a successful applicant is one that must be prudently-managed, well-capitalized and rooted in sustainability,” Commissioner Wade said. “These are not short-term entities but must be committed to meeting the long-term obligations of their clients and ultimately provide another tool for businesses and employers to control their costs.”

A captive insurance company is wholly owned by a parent company and operates to insure the parent’s risk and control costs. A sponsored captive’s client is not the parent company but rather can be one or more entities that use segregated accounts or “cells” set up by the sponsor to finance each client’s risk. The Hartford-based SOBC captive will provide risk financing, management and claims services for portfolio transfers of small books of business currently exiting the market.

“We are very excited to be the first “sponsored captive” licensed in Connecticut,” said Brian Johnston, President, SOBC Insurance Company Limited. “Our experience with this well-regulated state has been excellent.  John Thomson and his team at the Insurance Department have been extremely responsive to our unique business plan.  Our new Connecticut platform gives us the ability to segregate the portfolios of acquired assets, which is a significant advantage for our business and our clients.”

About the Connecticut Insurance Department: The mission of the Connecticut Insurance Department is to protect consumers through regulation of the industry, outreach, education and advocacy. The Department recovers an average of $4 million yearly on behalf of consumers and regulates the industry by ensuring carriers adhere to state insurance laws and regulations and are financially solvent to pay claims. The Department’s annual budget is funded through assessments from the insurance industry. Each year, the Department returns an average of $100 million a year to the state General Fund in license fees, premium taxes, fines and other revenue sources to support various state programs, including childhood immunization.
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Content Last Modified on 5/27/2015 12:37:57 PM