Tennessee-domiciled captive insurance companies’ written premiums rose by 20 percent to $1.2 billion last year, despite the state seeing reduced growth in new captive licences and a rise in captive closures.
Statistics from the Tennessee Department of Commerce and Insurance (TDCI) revealed that 31 risk-bearing entities (RBEs), 16 new captives and 15 new captive cells, were licensed in the state in 2018, a reduction on the 48 RBEs, 10 captives and 38 cells, licensed the previous year.
The TDCI statistics also showed that 48 RBEs, 10 captives, and 38 cells, closed in Tennessee last year, a rise from the 39 RBEs, 10 captives and 29 cells, that closed in 2017.
This net reduction in terms of total RBEs means that at year-end 2018, there were 476 active RBEs, 145 captives and 331 cells, licensed in the state.
The 145 active captives were made up of 102 pure captives, 33 protected cell captives, eight risk retention groups, and two association captives.
Despite the drop in the total number of active licenses, written premium, which exceed $1 billion for the first time in 2017, rose by 20 percent to $1.2 billion last year.
Michael Corbett, director of captive insurance at the TDCI, commented: “The captive section ended the year having opened a grand total of 180 captives and 435 cells (615 RBEs) since the statute was revised in 2011.”
“At December 31, 2018, 133 captives and 320 cells (453 RBEs) are still in operation.”
“We anticipate 2019 being another strong year for Tennessee Captives.”