The South Carolina Department of Captive Insurance (SCDOI) was pleased with its captive figures in 2017 despite “external forces” that have cut the amount of licensed captives per year, according to SCDOI captive administrator, Jeff Kehler.
Kehler said it was no longer realistic for the domicile to licence 20-30 new captives per year, given the external forces at play. These include the sustained soft market, saturation of the large corporate sector, and the large number of US-based domiciles available to prospective captive owners.
He added: “Against this backdrop, we’re pleased with how 2017 turned out for us, and very gratified at the growing recognition from the industry that in South Carolina, it’s all about quality.”
SCDOI licensed a total of 15 new captives in 2017, which included two risk retention groups, three pure captives, nine special purpose captives and one incorporated cell, mean the state now has a total of 169 active captives.
South Carolina also saw nine companies deleted from its portfolio, eight voluntary dissolutions and one merger.
According to SCDOI captive director Jay Branum, the net gains that the domicile posted to their portfolio represented how positive 2017 had been for them in comparison to the rest of the market.
Branum explained: “Our new versus dissolved numbers compare quite favorably with the numbers reported so far by other domiciles, including Vermont–24 new versus 39 dissolved–and Utah–60 new versus 106 dissolved.”
“We’re still posting net gains to our portfolio as opposed to the net losses some other domiciles are experiencing.’
Branum also suggested that the figures showed that South Carolina were “more than holding our own in this domicile-congested onshore environment.”
He continued: “The keys for us continue to be the quality of the programs, and the commitment of the captive owners. I would rather have 15 solid programs with committed owners for whom tax is a secondary concern than dozens of tax-driven micro-captives which in some cases bring in fewer premium tax dollars than the cost of licensing and regulating them.”