§ 27-43-5. Minimum surplus. (a)(1) No captive insurance company shall be issued a license unless it shall possess and after this maintain free surplus of:

(i) In the case of a subsidiary captive insurance company, not less than one hundred fifty thousand dollars ($150,000);

(ii) In the case of an association captive insurance company incorporated as a stock insurance company, not less than three hundred fifty thousand dollars ($350,000);

(iii) In the case of an industrial insured captive insurance company incorporated as a stock insurance company, not less than three hundred thousand dollars ($300,000);

(iv) In the case of an association captive insurance company incorporated as a mutual insurance company, not less than seven hundred fifty thousand dollars ($750,000); and

(v) In the case of an industrial insured captive insurance company incorporated as a mutual insurance company, not less than five hundred thousand dollars ($500,000).

(2) The surplus may be in the form of cash or an irrevocable letter of credit issued by a bank chartered by the state of Rhode Island or a member bank of the Federal Reserve System and approved by the commissioner.

(b) The commissioner may prescribe additional surplus based upon the type, volume, and nature of insurance business transacted, which surplus may be in the form of a irrevocable letter of credit issued by a bank chartered by the state of Rhode Island, or a member bank of the Federal Reserve System.

(c) No captive insurance company may pay a dividend out of, or other distribution with respect to, surplus, in excess of the limitations set forth in § 27-43-12, without the prior approval of the commissioner. Approval of an ongoing plan for the payment of dividends or other distributions shall be conditioned upon the retention, at the time of each payment, of the capital or surplus in excess of amounts specified by, or determined in accordance with formulas approved by, the commissioner.

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