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Hawaii
Marsh Management Services Inc.
Head of Office: Ellen Charnley
Sales Coordinator: Ellen Charnley
Office Address
Topa Financial Center
745 Fort Street, 8th Floor
Honolulu, HI 96813-3800
United States |
Telephone: (702) 804-7465
Facsimile: (702) 804-7461 |
Mailing Address
P.O. Box 4238
Honolulu, HI 96812
United States
Basic Information
| Location |
Hawaii is a group of islands located in the Pacific Ocean approximately 2,500 miles from the West Coast of the United States mainland. |
| Accessibility |
Direct flights are available to Hawaii from many U.S. cities, including Chicago, Dallas, Detroit, Los Angeles, New York, Las Vegas, Phoenix, Portland, San Francisco and Seattle. Direct flights are also available from several major Japanese cities. |
| Applicable Legislation |
Act 253, effective July 1, 1987, subsequently revised and re-codified effective July 1, 1988 as Article 19 of Chapter 431, Hawaii Revised Statutes. |
| Number of Captives |
165 as of February 1, 2008 |
| Regulatory Agency |
Department of Commerce & Consumer Affairs — Insurance Division, Captive Administration Branch |
Regulatory Issues
| Acceptable Insurance Subsidiaries |
Class 1: pure captive that only writes business as a reinsurer
Class 2: pure captive that is not a Class 1 (can write direct or reinsurance business)
Class 3: association captive or risk retention group
Class 4: leased capital facility (protected cell captive)
Class 5: reinsurance or excess insurance company |
| Acceptable Corporate Forms |
Stock, mutual, or reciprocals |
| Permitted Business |
All Property and Casualty lines; Personal Lines under certain circumstances upon approval of the Commissioner |
| Direct Insurance Permitted |
All permitted business |
| Reinsurance Permitted |
Any line of insurance, upon approval of the Commissioner |
| Policy Form and Rate Approval |
Not required |
| Local Office Requirement |
- Principal place of business
- At least one Board of Directors meeting held annually in Hawaii
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Capitalization & Solvency Requirements
| Minimum Capital: |
Class One: $100,000
Class Two: $250,000
Class Three: $500,000
Class Four: $1,000,000
Class Five: Not defined by Statute
Minimum capital and surplus is determined on a case-by-case basis. The Commissioner reviews the proposed captive operations and determines the appropriate level or capitalization. The amounts listed above are the minimum statutory levels. The captive’s minimum statutory capital and surplus must be maintained in the form of cash, public obligations, irrevocable letter of credit issued by a bank chartered in the state of Hawaii or a member bank of the Federal Reserve System and approved by the Commissioner, or another investment approved by the Commissioner. |
Premium Taxes |
Premium taxes are imposed on gross direct written premium received on risks located in Hawaii or those risks located outside of Hawaii which have not been taxed at source. Premium taxes are waived on reinsurance premium assumed. The premiums tax is in lieu of all other state taxes except real and personal property taxes.
Tax Rate
0.25% on first $25m
0.15% on next $25m
0.05% thereafter uo to $200m
Maximum premiums tax is $200,000
Premium tax is not assessed on reinsurance premiums assumed by the captive or on premiums that have been previously taxed in another jurisdiction.
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| Intercompany Loans |
Subject to the approval of the Insurance Commissioner |
Investment Restrictions |
Funds must be invested in accordance with regulations governing all Hawaii insurers, except that pure captives may obtain approval from the Commissioner for investments not specified in the insurance code.
Pure captives may invest in accordance with a strategic investment policy approved by the captive's Board of Directors and the Insurance Commissioner.
Investment guidelines are located in Article 19 of Article 6 Chapter 431 of the Hawaii Revised Statutes. |
| Taxation |
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. The State of Hawaii does not impose an income tax or excise tax on Hawaii domiciled captives. |
| Reporting Requirements |
- Audited financials
- Certified loss reserves
- NAIC statutory annual statement (RRG and Association Captives only)
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