NU Online News Service, March 16, 1:10 p.m. EDT
TUCSON, Ariz.—Because of the rapid growth of captive insurers in the state, Utah has added two examiners this year and will hire another within the next two months, said the state's captive regulator.
The domicile licensed 54 captives in 2010, bringing the total to 188, Ross Elliott, Utah's captive division director, told NU Online News Service. In 2009, 33 were added, and 32 were added in 2008, he said.
He explained that the formations were primarily single-parent captives. A risk retention group, two agency captives and one special-purpose captive were also formed in 2010.
Mr. Elliott added that the majority of captives formed were small, 831(B) captives. While these formations have given Utah a solid base, he said his goal now is to attract larger companies.
He noted that 79 percent of the captives in Utah are California-based organizations. Utah is next with 33 percent, followed by Texas at 10 percent and Ohio at 8 percent. Seventeen other states also have formed captives in Utah.
The state adopted captive legislation in 2003 and has steadily added captives. In 2008 there were 123 active captives, 148 in 2009 and 188 in 2010. The state's biggest year was 2007 with 63 formations, followed by 54 in 2010, according to the State of Utah Insurance Department.
The majority of captives in the state are in the real-estate industry, followed by manufacturing, construction, financial services and health care. Dissolutions were primarily in the areas of construction and mortgage, Mr. Elliott said.
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