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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2012 ENROLLED
SENATE BILL NO. 205
BY SENATOR MORRISH
AN ACT1
To amend and reenact R.S. 22:550.3(B), 550.10, 550.12(A), 550.13(B)(4), and 550.16(C),2
relative to captive insurers; to reduce the unimpaired paid-in capital requirements for3
captive insurers; to clarify requirements and prohibitions for captive insurers; to4
provide technical changes; and to provide for related matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 22:550.3(B), 550.10, 550.12(A), 550.13(B)(4), and 550.16(C) are7
hereby amended and reenacted to read as follows: 8
§550.3. Applicability of other provisions9
* * *10
B. The provisions of R.S. 22:71 and 72 regarding conversions apply to11
captive insurers licensed pursuant to this Chapter.12
* * *13
§550.10. Capital and surplus requirements14
A. A pure captive insurer shall maintain at all times, in addition to any other15
capital or surplus required to be maintained pursuant to Subsection C D of this16
Section, unimpaired paid-in capital and surplus of not less than one million five17
hundred thousand dollars.18
B. An association captive insurer shall maintain at all times, in addition19
to any other capital or surplus required to be maintained pursuant to20
Subsection D of this Section, unimpaired paid-in capital and surplus of not less21
than one million dollars.22
B.C. Except as otherwise provided by the commissioner pursuant to23
Subsection B D of this Section, the capital required to be maintained pursuant to this24
Section must be in the form of cash, cash equivalents, or bonds or evidences of25
indebtedness which are direct general obligations of the government of the United26
States.27
ACT No. 633 SB NO. 205 ENROLLED
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
C. D. The commissioner may prescribe additional requirements relating to1
capital and surplus based on the type, volume and nature of the insurance business2
that is transacted by the captive insurer.3
* * *4
§550.12. Suspension or revocation of certificate of authority; hearings5
A. The commissioner may refuse, suspend or revoke the certificate of6
authority of a captive insurer if, after an examination and hearing, the commissioner7
determines that the captive insurer satisfies any one of the following items:8
(1) Is insolvent or has impaired its required capital or surplus.9
(2) Is in such condition that its further transaction of business in this state10
would be hazardous to the policyholders, creditors, or the public.11
(3) Has failed to meet a requirement of R.S. 22:2420 550.10.12
(4) Has refused or failed to submit an annual report, as required by R.S.13
22:2431 550.21, or any other report or statement required by law or by order of the14
commissioner.15
(5) Has failed to comply with the provisions of its charter or bylaws.16
(6) Has failed to submit to an examination, or has refused or failed to pay the17
cost of an examination required pursuant to R.S. 22:2432 550.22.18
(7) Has used any method in transacting the business of insurance pursuant19
to this Chapter which is detrimental to the operation of the captive insurer or would20
make its condition unsound with respect to its policyholders or the general public.21
(8) Has failed otherwise to comply with the laws of this state.22
(9) The suspension or revocation of the certificate of authority of the captive23
insurer is in the best interest of its policyholders or the general public.24
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§550.13. Authorized and prohibited types of insurance26
* * *27
B. A captive insurer licensed pursuant to this Chapter shall comply with the28
following:29
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
(4) The insurer shall not accept or cede reinsurance, except as otherwise1
provided in R.S. 22:2427550.17.2
* * *3
§550.16. Investments; loan to parent or affiliated company in certain circumstances4
* * *5
C. A pure captive insurer may make a loan to its parent or affiliated company6
if the loan meets each of the following requirements:7
(1) Is The loan is first approved in writing by the commissioner ;.8
(2) Is The loan is evidenced by a note that is in a form that is approved by9
the commissioner; and.10
(3) Does The loan does not include any money that has been set aside as11
capital or surplus as required by R.S. 22: 2420 550.10.12
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: