Tennessee Delivers 3 Modernized Rules for Captive Insurers

With an eye toward increasingly balanced regulation, the Tennessee Department of Commerce & Insurance (TDCI) is ushering in new, more modern rules to guide the Volunteer State's burgeoning captive insurance industry.

Tennessee believes that three new rules will set it apart from other US domiciles.

• First, Tennessee will allow individual protected cells to go dormant and later to be restarted.
• Second, new captive insurers and cell companies will no longer be required to be audited if they were formed in the last quarter of a year, thus representing cost-savings for the for captive insurers and cell companies.
• Finally, a full financial exam will not be required where specific limited questions have arisen about the operation of a captive company.

The new rules take effect December 21, 2017.

"These rule changes represent 6 years of lessons learned in licensing and regulating captive insurance companies and again demonstrate Tennessee's commitment to growing an important economic component," said TDCI Commissioner Julie Mix McPeak.