The leading US captive insurance domicile since a dedicated law passed in 1981, home to more than 600 active captives.
Vermont established itself as the leading US captive insurance domicile after passing, in 1981, a dedicated law that created a specific regulatory framework and a regulator trained in this particular business, at a time when few US states offered a suitable environment. The state is now home to more than 600 active captives, making it the country's largest captive domicile ahead of competitors such as Delaware, Utah, or offshore jurisdictions like Bermuda or the Cayman Islands, and the captive industry accounts for a significant share of its financial services economy. Vermont's success rests on the long-term stability of its regulation, the availability of local captive management expertise, and a capped premium tax that stays competitive even for large structures. A captive is typically set up there by a company that wants to self-insure risks it knows well but that the traditional market prices poorly, or to access reinsurance directly without going through a fronting insurer, particularly for risks such as professional liability or certain cyber exposures specific to its business.
A US industrial company judges its liability premiums poorly calibrated against its own claims history. It sets up a captive in Vermont, under the state's dedicated 1981 law, to carry the risk itself and access reinsurance directly.
captive Vermont, domicile captif américain