§ 23-63-1605 - Surplus requirements.
23-63-1605. Surplus requirements.
(a) (1) The Insurance Commissioner may not issue a license to a captive insurance company unless the company possesses and maintains unimpaired surplus of:
(A) In the case of a producer reinsurance captive insurance company, not less than three hundred thousand dollars ($300,000);
(B) In the case of a pure captive insurance company, not less than one hundred fifty thousand dollars ($150,000);
(C) In the case of an association captive insurance company incorporated as a stock insurer, not less than three hundred fifty thousand dollars ($350,000);
(D) In the case of an industrial insured captive insurance company incorporated as a stock insurer, not less than three hundred thousand dollars ($300,000);
(E) In the case of an association captive insurance company incorporated as a mutual insurer, not less than seven hundred fifty thousand dollars ($750,000);
(F) In the case of an industrial insured captive insurance company incorporated as a mutual insurer, not less than five hundred thousand dollars ($500,000);
(G) In the case of a sponsored captive insurance company, not less than five hundred thousand dollars ($500,000); and
(H) In the case of a special purpose captive insurance company, an amount determined by the commissioner after giving due consideration to the company's business plan, feasibility study, and pro formas, including the nature of the risks to be insured, but in no event less than three hundred thousand dollars ($300,000).
(2) The surplus may be in the form of:
(A) Cash;
(B) Other assets acceptable to the commissioner; or
(C) An irrevocable letter of credit issued by a bank chartered by this state or a member bank of the Federal Reserve System and approved by the commissioner.
(b) Notwithstanding the requirements of subsection (a) of this section, a captive insurance company organized as a reciprocal insurer under this subchapter may not be issued a license unless it possesses and maintains a free surplus of one million dollars ($1,000,000).
(c) (1) The commissioner may prescribe additional surplus based upon the type, volume, and nature of insurance business transacted.
(2) This capital may be in the form of:
(A) Cash;
(B) Other assets acceptable to the commissioner; or
(C) An irrevocable letter of credit issued by a bank chartered by this state or a member bank of the Federal Reserve System.
(d) (1) A captive insurance company may not pay a dividend out of, or other distribution with respect to, capital or surplus in excess of the limitations set forth in 23-63-515, without the prior approval of the commissioner.
(2) Approval of an ongoing plan for the payment of dividends or other distribution must be conditioned upon the retention at the time of each payment of capital or surplus in excess of amounts specified by or determined in accordance with formulas approved by the commissioner.
(3) Subsection (d) of this section shall not apply to a producer reinsurance captive insurance company.