News & Analysis as of

Captive Insurance Company

Draft North Carolina Tax Legislation Released

by Smith Anderson on

On April 11, 2018, the General Assembly’s Revenue Laws Study Committee released a draft tax bill for possible introduction in the legislative session that convenes May 16. This Alert provides a summary of the more important...more

Captive Insurance Update | Issue No. 1 | 2018 - A summary of state and federal developments in the captive insurance industry

by Downs Rachlin Martin PLLC on

Vermont’s leadership team for captive insurance was remarkably stable in 2017. Governor Phil Scott and Michael Pieciak, the Commissioner of the Department of Financial Regulation (the “DFR”), completed their first full year...more

Abusive Tax Shelters Ranked Eleventh On IRS Annual “Dirty Dozen” For 2018

by Fox Rothschild LLP on

The Internal Revenue Service has warned taxpayers to be wary of abusive tax shelters, which remain on the annual “Dirty Dozen” list of tax scams for 2018. These sophisticated schemes, particularly those involving...more

Amendment to D.C. Captive Statute Introduced

by Locke Lord LLP on

Earlier this month, the Captive Insurance Agency Amendment Act of 2017 (DC LB 420) had its first reading before the District of Columbia Council. If enacted, LB 420 would increase the number of insurance products available...more

Following Cunningham, Pennsylvania District Court Finds Captive Reinsurance Putative Class Action Claims Are Time-Barred

by Carlton Fields on

In this putative class action, plaintiffs alleged unlawful practices related to mortgage insurance practices, including a violation of the Real Estate Settlement Procedures Act of 1974 (“RESPA”). ...more

D.C. Circuit Court Affirms the Legality of Captive Reinsurance Arrangements

by Pepper Hamilton LLP on

While the court opinion on the constitutionality of the CFPB’s structure was long awaited, its decision related to RESPA affords the mortgage industry much-needed clarity. ...more

IRS Focuses Its Audit Priorities on Captive Insurance

by Blank Rome LLP on

The terms "captive insurance" and "federal income tax code" are anything but captivating. Yet, captive insurance has captivated the attention of the Internal Revenue Service ("IRS"), which has placed captive insurance on its...more

Can a Captive Insurance Company Help You Keep Your 8(a) Certification?

by PilieroMazza PLLC on

At the beginning of 2017, the Protecting Americans from Tax Hikes (“PATH”) Act went into effect. One of the changes implemented by the Act altered how small and medium-sized business owners can use captive insurance companies...more

Tennessee Revises Rules Regarding Captive Insurance Companies

by Carlton Fields on

The Tennessee Department of Commerce and Insurance has substantially revised its rules for captive insurance companies. Significant changes include...more

Tax Court Disallows Deductions For Payments To Captive Insurance Company

by Carlton Fields on

A husband and wife who paid $1.54 million in premiums to their captive insurance company and $720,000 in premiums to another insurer over two years, almost all of which ended up back in their bank accounts, have had their tax...more

Global In-House Centers in India, v2.0

GICs in India are evolving from cost-saving platforms into Innovation Centers for emerging digital technologies that can provide a competitive advantage. Recent years have seen a resurgence of interest in GICs in India...more

InsureTech Connect 2017 Panel Discussion: Maximizing Profits via Products and Alternative Business Model Innovation

by Mintz Levin on

After being in the insurance industry for several decades in a variety of roles, I frequently get asked which insurtechs I think are going to be successful. In sum, I believe the insurtechs best positioned for success are...more

Takeaways from the Tax Court's First Micro-Captive Insurance Ruling

by Holland & Knight LLP on

• The U.S. Tax Court recently ruled in Avrahami v. Commissioner, the first litigated Tax Court case involving an 831(b) captive insurance company. • The Tax Court held that two of the key factors that define "insurance"...more

Delaware Governor Signs Law Creating Streamlined And Inexpensive Regulatory Regime For Dormant Captive Insurance Companies

by Carlton Fields on

The bill defines a dormant captive insurance company as one that (1) did not contract for any direct premium or reinsurance premium for a full calendar year, (2) is not obligated as an insurance company under any contract of...more

Court Dismisses Suit By Rehabilitator For PMI Insurer Against Captive Reinsurer And Affiliated Bank

by Carlton Fields on

A district judge in the Northern District of Illinois has dismissed all claims brought by the Illinois Director of Insurance, acting as rehabilitator for Triad Guaranty Insurance Corporation and Triad Guaranty Assurance...more

Lender-Affiliated Captive Reinsurer Obtains Dismissal Of Mortgage Insurance Lawsuit Brought By Illinois Director Of Insurance

by Carlton Fields on

The suit arose out of an arrangement where lenders would refer borrowers to (now-defunct) Triad Guaranty Insurance Company (Triad) to obtain private mortgage insurance. The lender-affiliated captive insurance company would...more

Summer 2017 Sees Hot Developments in Regulating Insurer Capital and Life Reserve Financing

At the recent National Association of Insurance Commissioners (NAIC) Summer National Meeting held in Philadelphia from August 6, 2017, to August 9, 2017, the NAIC continued its work on group capital calculation standards,...more

Client Alert: Avrahami v. Commissioner: An Important Ruling on Microcaptive Structures

While many were captivated by the solar eclipse on August 21st, the US Tax Court, in Avrahami v. Commissioner, shed judicial light on the tax treatment of what is known as a “microcaptive” insurance company. More...more

Tax Court Issues Opinion Striking Down Captive Insurance Arrangement

by Fox Rothschild LLP on

The Tax Court has issued its long-awaited decision addressing captive insurance arrangements. In Avrahami v. Commissioner, 149 T.C. No. 7 (2017), the Tax Court held that payments made from a number of businesses owned by the...more

Tax Court Decides First Micro Captive Case

On August 21, 2017, the Tax Court issued its opinion in two companion cases Benyamin Avrahami and Orna Avrahami v. Commissioner, and Feedback Insurance Company, Ltd. v. Commissioner, 149 T.C. No. 7, holding against the...more

Georgia Revamps Law Governing Captive Insurance Companies

by Carlton Fields on

Significant changes to Georgia law governing captive insurance companies took effect on July 1, 2017. The changes relate to the permitted corporate structure of captive insurance companies, new restrictions on risks that may...more

Captive Insurance Update | Issue No. 1 | 2017 - A summary of state and federal developments in the captive insurance industry

Changes at the Top - Republican Phil Scott was elected Governor of Vermont in November 2016, having previously served as Lieutenant Governor for six years. Governor Scott has re-appointed Michael Pieciak to serve as the...more

Montana Enacts Captive Insurance Law Impacting Reciprocal And Dormant Insurers

by Carlton Fields on

On May 4, 2017 Montana enacted a new law that will remove the requirement that reciprocal captive insurers have 25 or more persons domiciled in Montana. The law also permits captive insurers to go into dormancy. The...more

The Rise of the Group Health Insurance Captive

With its “employer mandate”—i.e., the requirement that applicable large employers make an offer of group health coverage to substantially all full-time employees or face the prospect of a penalty—the Affordable Care Act (ACA)...more

The future of Hong Kong's insurance industry – New focus on reinsurance and captives?

by Hogan Lovells on

The Hong Kong Financial Services Development Council, an advisory body to the government, has recently released a report on the Hong Kong insurance sector. Its key recommendations are...more

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