Michigan captive bill reaches next stage
–21 February 2008
Michigan has moved a step closer to becoming a captive insurance domicile after its Senate passed Bill SB 1061, which is now under consideration in the House.
Under the proposed measure, captives would not be assessed premium taxes, but instead, would be charged an annual fee based on the amount of premiums generated by the captive. Those fees would range from $5,000 for captives with annual premiums of less than $10 million to $25,000 for captives with premium volume of at least $60 million.
The bill would also set the minimum capital and surplus requirements at $150,000 for a single-parent captive and at $400,000 for an association captive organised as a stock company or limited liability company.
The Michigan legislation would allow employers to set up branch captives, a feature aimed at employers that want to fund employee benefit risks through captives but also want to continue to sponsor captives outside the United States.
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