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Steps to Form a Captive

The department encourages all companies interested in forming a captive to contact one of the approved managers. The prospective captive owner can rely on the manager's expertise in this area. If at any point you wish to contact the department directly, please feel free to do so.

Generally, the process of incorporating a captive insurer in Vermont and applying for a license from the Department of Financial Regulation will involve the following steps:

  1. Select an approved manager in Vermont.
  2. Arrange a meeting through your approved manager with the Deputy Commissioner of Captive Insurance and staff to discuss the proposed captive and obtain initial reactions from the department.
  3. Prepare documents necessary for organization. The services of a local lawyer may be desirable.
  4. Prepare documents necessary for application to the department. (See Applications and Forms for a list of these items.)
  5. Submit one copy of all materials in numbers (3) and (4) above to the commissioner of Financial Regulation for review. Include the $6,000 (effective 7/1/2019) Actuarial Application Review fee; $10,000 for Special Purpose Financial Insurance Companies (SPFIs).
  6. Submit one additional copy of the application material to the assigned review firm when instructed to do so by the commissioner.
  7. Petition the commissioner to issue a Certificate of Public Good. The factors to be addressed are outlined in 8 V.S.A. Sec 6006(d).
  8. After the commissioner has issued the Certificate of Public Good, present this and the documents in number (3) above to the Secretary of State's office along with the appropriate fee in order to organize the captive (see 11 V.S.A. Sec 3026 and 11A V.S.A. Sec 1.22).
  9. After the organization, apply to the commissioner for a Certificate of Authority and submit a $500.00 license fee; $5,000.00 for SPFIs.
  10. Special Purpose Financial Insurance (SPFI) Companies may be required to take other or additional steps. If you are forming a SPFI,  please contact us directly to obtain additional information.

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