Senators review bill to expand captive insurance options, add protected cell captives

The Kansas Senate Committee on Insurance opened a hearing on House Bill 2,334, which would update the state’s Captive Insurance Act by creating a protected cell captive structure, authorizing provisional certificates of authority, lowering certain fees and changing examination frequency.

Eileen (committee reviser) briefed the committee that sections 1–10 of HB 2,334 would enact a Kansas Protected Cell Captive Insurance Company Act and that later sections would amend existing captive statutes. She summarized key provisions: who may form a protected cell captive; corporate forms allowed (mutual, nonprofit or LLC); required application materials; accounting rules (cells’ assets may be combined for investment but must be accounted for separately); and that protected cells would be insulated so a cell’s assets cannot be used to pay another cell’s claims except as expressly provided.

Representative John Tarwater, the bill’s principal proponent, said captive insurance is a form of self‑insurance for businesses and described potential cost‑saving and flexibility benefits. "Captives can try these things and then the major…