House advances captive insurance clarifications aimed at drawing domiciles to Utah

Representative James Dunnegan, sponsor of House Bill 17, told the House the bill clarifies and corrects language from last year’s Captive Insurance Companies Act and makes it easier for large companies to domicile captive insurers in Utah. He said the change is intended to keep premium tax revenue in Utah rather than having companies domicile out of state and to provide convenience and administrative benefits to firms that self-insure.

The sponsor said the state already collects “in excess of a hundred million dollars each year in premium tax” on property and casualty insurance and that establishing captive insurers in Utah would allow the state to capture some premiums now paid to other states. He said three companies had expressed interest and that a fiscal note attached to last year’s bill projected a positive $10,000 for the current fiscal year, but that longer-term revenues are uncertain.

Members questioned the fiscal projection and a constitutional concern noted in the bill analysis. Representative Sam Daniken and others asked whether the fiscal note was adequate and why the bill included a constitutional note about requiring a Utah contact for out‑of‑state companies. Dunnegan and supporters explained the in‑state contact requirement is intended to ensure service of process can be made in Utah if legal issues arise; other states impose similar requirements, they said.

After floor discussion and summation by the sponsor, the House recorded the vote on the measure during the floor period. The transcript records that the measure received 58 yes votes and 14 no votes on the floor vote sequence for this bill (the transcript labels the resulting line as “House Bill 18,” which appears to be a segment-labeling inconsistency in the record).