Vermont Marks the Licensing of its 1,200th Captive Insurance Company

Vermont has licensed its 1,200th captive insurance company, top Vermont government and captive regulators announced February 9.

The captive, Sustainable Assurance Company (SAC), was formed by parent company Lancaster County Solid Waste Management Authority (LCSWMA) in Lancaster, Pennsylvania.

"Vermont has a rich history, proven experience, and has a great reputation in the industry. We wanted to do it right and partner with the best to make this happen. It was an easy decision for us," Robert Zorbaugh, LCSWMA's CEO said in a statement.

"As Vermont reaches another significant milestone for our captive insurance industry, we look forward to continuing our reputation as a global leader in this sector and utilize our position to bring more captives to Vermont," Vermont Governor Phil Scott said in a statement.

SAC, which is managed by Artex Risk Solutions, will be used to provide property coverage to its parent.

The licensing of SAC comes as Vermont later this year will mark its 40th anniversary as a captive insurance domicile. In those 40 years, Vermont has grown significantly as a captive domicile. With 589 captives at the end of 2020, Vermont is the largest US captive insurance domicile and the world's third largest.

Vermont officials say keeping the state's captive statute up to date has been a key factor in the state’s growth as a captive insurance domicile.

"The Vermont Legislature has been a constant source of support over the last 40 years, regularly working with us to pass new captive insurance bills that have helped keep Vermont at the forefront of the industry," Michael Pieciak, commissioner of Vermont's Department of Financial Regulation in Montpelier, said in a statement.

Last year, for example, Vermont lawmakers passed a measure reducing minimum capitalization requirements for sponsored cell captives, while legislation approved in 2019 gave captives more time between mandatory financial examinations.