Montpelier, Vt. –The Vermont Department of Economic Development announced today that 2023 reflected a strong year for captive insurance in the State of Vermont and that the New Year already is off to an even stronger start.
Besides earning global recognition as the leading domicile for captive insurance, Vermont licensed a total of 38 new captive insurance companies in 2023, making it now home to 659 licensed captives, consisting of 632 active and 27 dormant captives. And, in 2024, it already has licensed 9 new captives. Vermont has licensed a total of 1,330 captive insurance companies to date. The growth in captive formations in 2023 is among the top ten highest since Vermont licensed its first captive in 1981.
“Vermont remains a credible global leader and committed to continuing to lead the industry with innovative, high-quality regulation that meets the needs of captive insurance companies,” said Governor Phil Scott.
The new captives were licensed in 13 different industries, the top three industries being manufacturing (7), insurance (6), and real estate (6). The formation types were pure (24), Sponsored (6), Agency (1), Association (2), Special Purpose Finance Insurer (3) and Risk Retention Groups (2). Cell formations are keeping pace with growth in licensed captives. In addition to the number of newly licensed captive insurance companies, Vermont’s 62 Sponsored captive insurance companies continue to experience growth in the number of new protected cells, with over 30 additions in 2023. Sponsored captive insurance companies provide a licensed insurance vehicle with an established structure for companies to participate in their own risks via protected cells.
In addition to growth in the number of captive licenses issued, the state of Vermont and several Vermont leaders in the captive industry earned honors and recognition that kept Vermont in the captive news throughout the year. In June 2023, Captive media publications Captive Review and Captive Intelligence declared Vermont the top captive insurance domicile worldwide. In addition to multiple national awards, including Domicile of the Year by Captive International, Vermont won the Captive Review International Domicile of the Year award. Department of Financial Regulation (DFR) Deputy Commissioner of Captive Insurance Sandy Bigglestone was named third most influential captive insurance professional in the world in the 2023 Power 50 awards by Captive Review.
“I am appreciative and grateful for the entire Captive Insurance Division staff, for their consistent great work and dedication to quality regulatory standards, involving licensing, analysis, and examinations, and those who quietly excel in their daily tasks to make the workplace function smoothly,” Deputy Commissioner of Captive Insurance Bigglestone said.
“Companies continue to face challenges placing insurance and find they are better able to negotiate when they have a captive that can take on higher retentions and fill gaps in coverage,” said Director of Captive Insurance, Christine Brown. “A captive gives its owner(s) options and allows for greater control over underwriting and claims management, ultimately resulting in better risk management practices to create positive outcomes.”
At least seven of Vermont’s new captives in 2023 have international roots hailing from Canada, Chile, Germany and the United Kingdom. In March 2023 a Vermont delegation collaborated with the Vermont Captive Insurance Association (VCIA) to host an educational event and Trade Mission in Mexico City to connect with the region about captive insurance.
“We’d heard consistently that the Latin American market needed more captive insurance education,” said Kevin Mead, President of the VCIA. “When we went to Mexico, we found that there was indeed great interest in captive insurance as a risk financing tool and we plan to continue our efforts in the region in the year ahead.”
The Vermont Captive Insurance Emerging Leaders (VCIEL) initiative launched in March 2023 was among a host of businesses, groups and organizations featured in the recently released Educating and Elevating the Captive Industry, the Special 20th Anniversary Commemorative International Center for Captive Insurance Education Report by Captive International. Formed in affiliation with the VCIA and with support from the State of Vermont Economic Development Department, VCIEL comprises about 30 captive insurance professionals in Vermont with a goal of raising awareness about captive insurance as a career path in the region.
“We recognize that we are at a critical time in the captive industry where the industry needs to work together to highlight captive insurance careers so we can keep pace with growth,” said Brittany Nevins, Captive Insurance Economic Development Director, Department of Economic Development, and current Chair of the VCIEL.
“Vermont continues to be a thought leader in this industry in the face of new challenges,” DFR Commissioner Kevin Gaffney said. “Raising awareness in all aspects of this industry is essential to our continued success.”