January 2025 Edition

Happy New Year! As we step into 2025, we at U.S. Captive Partners & Associates are excited to continue supporting your risk management and insurance needs. The captive insurance industry has seen significant growth, with states like Tennessee and North Carolina reporting record numbers of new formations in 2024.

Captive insurance offers numerous advantages, including economic benefits and enhanced risk management. By forming a captive insurance company, businesses can dramatically lower insurance costs compared to premiums paid to conventional property and casualty insurance companies.

For instance, one of our clients in the retail wholesale industry recently benefited from their captive's "Loss of Key Customer" coverage. After being forced to close several stores due to a franchise merger, they were able to recover approximately $200,000 in income loss and expenses through their captive policy.

We are here to help you explore the potential advantages of forming a captive insurance company tailored to your specific needs. Please feel free to reach out to us at 1-833-US-CAPTIVE (1-833-872-2784) or via email at LPapola@US-Captive.com.

Wishing you a prosperous 2025!

Sincerely,

Larry Papola

Lawrence J. Papola, Jr.

President

LPapola@US-Captive.com

1-833-US-CAPTIVE

(1-833-872-2784)

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Tennessee Captive Insurance Section Reports Record Growth in 2024

In its latest update, Mark Wiedeman, director of the Tennessee Department of Commerce and Insurance (TDCI) Captive Insurance Section, highlighted the team's achievements and provided news on Tennessee's continued growth as a leading captive domicile.

For the first time since Mr. Wiedeman joined the department, the captive insurance section is fully staffed, with a team of 17 dedicated regulars. This year, the team has added 52 new risk-bearing entities (RBEs), including all types of captives as well as individual cells, bringing the total number of RBEs under Tennessee's jurisdiction to 767—a year-to-date increase of 14 percent...

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North Carolina Captive Insurance Association Prepares for Growth in 2025

The North Carolina Captive Insurance Association (NCCIA) reports strong activity in 2024, with the state seeing continued growth in captive licensing and cell formations. While the final numbers will be released in early 2025, the North Carolina Department of Insurance has indicated that the year will be another successful one for the captive domicile.

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Captive Claim Highlight

Client Profile

Industry: Retail Wholesale

Specialty: Franchiser of Electronic Retail Stores

Location: New York

Claim Information

Description: One of our Insureds owns and operates several franchise locations under an Authorized Representative Agreement. The franchise company merged with another, which forced the Insured to close several stores which were too close in proximity to others. In turn, the Insured terminated the leases for those locations and incurred expenses related to rebranding the remaining locations to align with the surviving franchise. In addition, they also lost the ability to generate income in the stores which they were forced to close. Through their Captive's Actual Net Loss Insurance Policy "Loss of Key Customer" coverage, they were able to recover the income loss and expenses.

Line of Coverage: Loss of Key Customer

This exposure was elected for coverage by the client under their Captive Policy. This resulted in a claim payment amount of approximately $200,000.

*Please note that each claim will undergo an independent investigation and thorough review process. Various components specific to the claim at hand will be assessed thoroughly to determine if the loss is covered by the policy.

Happening This month:

1/9: Law Enforcement Appreciation Day

1/18: Winnie The Pooh Day

1/19: National Popcorn Day

1/20: MLK Jr. Day

1/20: Inauguration Day

1/21: National Hug Day

1/24: National Peanut Butter Day

1/27: Holocaust Remembrance Day

1/31: National Hot Chocolate Day

Why Form a Captive?

There are numerous potential advantages to forming a captive insurance company. Captive insurance companies are formed for both economic and risk management purposes. By forming a captive insurance company, a business can dramatically lower insurance costs in comparison to premiums paid to a conventional property and casualty insurance company.

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48 South Service Road

Suite 400

Melville, NY 11747

Office: 1-833-US-CAPTIVE

(1-833-872-2784)

Fax: 1-888-929-6565