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Colorado
Marsh USA Inc.
Head of Office: Julie Boucher, CPA
Sales Coordinator: Julie Boucher, CPA; Chris Varin, CPA, CITP, ARM
Office Address
100 Bank Street, Suite 610
Burlington, Vermont
05401
United States
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Telephone: (802) 864-5912
Facsimile: (802) 859-3550
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Mailing Address
P.O Box 530
Burlington, Vermont 05402-0530
United States
Basic Information
| Location |
Colorado is located in the western United States. |
| Accessibility |
Frequent flights are available to Denver, Colorado from New York, Chicago and Los Angeles. |
| Applicable Legislation |
Colorado became the first domicile in the United States to authorize the formation of captives with the passage of the Colorado Captive Insurance Company Act in 1972. |
| Number of Captives |
6 as of 31-Dec-2008 |
Regulatory Agency |
Colorado Division of Insurance, Department of Regulatory Agencies |
Regulatory Issues
| Acceptable Insurance Subsidiaries |
Pure and Group Captives. |
| Acceptable Corporate Forms |
Any organizational structure. |
| Permitted Business |
Only parent and its affiliate's risk. |
| Direct Insurance Permitted |
All property/casualty lines include Automobile Liability and General Liability, Surety and Employee Benefits. No life, personal lines or third-party. |
| Reinsurance Permitted |
All property/casualty lines including Auto Liability and General Liability, Surety and Employee Benefits. No life, personal lines or third-party |
| Policy Form and Rate Approval |
None required |
| Local Office Requirement |
Principal office and records in Colorado
Use of local manager. |
Capitalization & Solvency Requirements
| Entity |
Minimum
Capital |
Minimum
Surplus |
Total Capitalization
(Cash or Letter of Credit) |
Stock
Pure
Association |
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$500,000*
$500,000* |
Mutual
Association |
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$500,000* |
*$300,000 of the total $500,000 capital and surplus must be under joint custody and control with the Colorado Division of Insurance. The remaining $200,000 is under sole custody and control of the captive.
Premium Taxes |
Premium tax on
direct premiums
0.500% on first $25 million
0.250% on next $25 million
0.010% thereafter
(subject to a minimum of $5,000) |
Premium tax on
reinsurance premiums
0.25% on first $25 million
0.10% thereafter
(subject to a minimum of $5,000) |
Intercompany Loans |
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Pure captives may make loans to its parent if approved within its Plan of Operation. The loan amount must be within the maximum aggregate limit approved to be considered a permitted asset. Additionally the parent/recipient must:
have current assets exceeding current liabilities, including the loan as a current liability, on a non-consolidated basis with the captive,
provide an audited financial statement with an unqualified opinion,
report intangible assets, on a non-consolidated basis with the captive, in excess of its net worth.
Under special conditions a departure from the above is allowed with prior written approval from the CDOI provided that the loan contain an automatic repayment schedule that is tied to a mutually agreed upon index, such as the rating of the parent.
Generally, a loan must be in the form of a formal agreement with a provision that the loan will be repaid within 90 days of a request from the CDOI and contains specific maturity and interest provisions. |
Investment Restrictions |
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Admitted market restrictions apply to Group captives. No restrictions for Pure captives. |
Taxation |
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Income generated by the captive will be subject to the federal tax rate of the captive parent (assuming the parent is U.S. based); otherwise, the captive income will initially be subject to the U.S. federal rate and consolidated at the rate of the foreign parent. |
Reporting Requirements |
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NAIC Blank and CPA audited statutory financial statements.
Pure captives may file a short form version of NAIC Blank.
A pure captive can also meet the NAIC Blank filing requirements by filing its audited financial statement no later than 60 days following the captive's fiscal year end.
Certification that the captive maintains its principal and home office, and that the office performs a significant portion of the captive's operations in the state of Colorado.
An audited financial statement must be prepared and filed no later than 150 days following the captive's fiscal year end
Colorado captives are required to undergo an independent audit each year and loss reserves must be substantiated by an actuarial certificate no later than 60 days following the captive's fiscal year end.
Actuary's report must be filed no later than 90 days following the captive's fiscal year end. |
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