§ 27-43-3. Licensing - Authority. (a) Any captive insurance company, when permitted by its articles of association or charter, may apply to the commissioner for a license to do any and all insurance; provided, that:

(1) No subsidiary captive insurance company may insure any risks other than those of its parent and affiliated companies;

(2) No association captive insurance company may insure any risks other than those of the member organizations of its association, and their affiliated companies;

(3) No industrial insured captive insurance company may insure any risks other than those of the industrial insured that comprise the industrial insured group, and their affiliated companies;

(4) No captive insurance company may provide personal lines of insurance, or any component of personal lines insurance; and

(5) No captive insurance company may accept or cede reinsurance, except as provided in § 27-43-7.

(b) No captive insurance company shall do any insurance business in this state unless:

(1) It first obtains from the commissioner a license authorizing it to do insurance business in this state;

(2) Its board of directors holds at least one meeting each year in this state;

(3) It maintains its principal place of business in this state; and

(4) It appoints a resident registered agent to accept service of process and to act on its behalf in this state. Whenever the registered agent cannot with reasonable diligence be found at the registered office of the captive insurance company, the commissioner shall be an agent of the captive insurance company upon whom any process, notice, or demand may be served.

(c)(1) Before receiving a license, a captive insurance company shall file with the commissioner a certified copy of its charter and by-laws, a statement under oath of its president and secretary showing its financial condition, and any other statements or documents required by the commissioner;

(2) In addition to the information required by subdivision (1) of this subsection each applicant captive insurance company shall file with the commissioner evidence of the following:

(i) The amount and liquidity of its assets relative to the risks to be assumed;

(ii) The adequacy of the expertise, experience, and character of the person or persons who will manage it;

(iii) The overall soundness of its plan of operation;

(iv) The adequacy of the loss prevention programs of its parent, member organizations, or industrial insured as applicable; and

(v) Any other factors deemed relevant by the commissioner in ascertaining whether the proposed captive insurance company will be able to meet its policy obligations.

(3) Information submitted pursuant to this section shall be and remain confidential, and may not be made public by the commissioner or an employee or agent of the commissioner without the written consent of the company, except that:

(i) The information may be discoverable by a party in a civil action or contested case to which the captive insurance company that submitted the information is a party, upon a showing by the party seeking to discover the information that:

(A) The information sought is relevant to and necessary for the furtherance of the action or case;

(B) The information sought is unavailable from other nonconfidential sources; and

(C) A subpoena issued by a judicial or administrative officer of competent jurisdiction has been submitted to the commissioner; provided, that the provisions of this subdivision do not apply to any industrial insured captive insurance company insuring the risks of an industrial insured group as defined in § 27-43-1(8)(ii); and

(ii) The commissioner may, in his or her discretion, disclose the information to a public officer having jurisdiction over the regulation of insurance in another state, provided that:

(A) The public official agrees in writing to maintain the confidentiality of the information; and

(B) The laws of the state in which the public official serves requires the information to be and to remain confidential.

(d) The commissioner is authorized to retain legal, financial and examination services from outside the department, the reasonable cost of which may be charged to the applicant. Each captive insurance company shall pay to the commissioner a nonrefundable fee of one thousand dollars ($1,000) for examining, investigating, and processing its application for license. In addition, it shall pay a license fee for the first year of registration and an annual fee for each year after this of five hundred dollars ($500).

(e) If the commissioner is satisfied that the documents and statements that the captive insurance company has filed comply with the provisions of this chapter, the commissioner may grant a license authorizing it to do insurance business in this state in accordance with the provisions of this title.

History of Section. (P.L. 1988, ch. 76, § 1; P.L. 1996, ch. 232, § 1; P.L. 1996, ch. 256, § 1; P.L. 2000, ch. 176, § 1; P.L. 2000, ch. 373, § 1.)