House amends captive insurance bill to tighten oversight of risk-retention groups and sponsored captives
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Summary
The House advanced H.649 after a committee report recommending amendments that bar risk-retention groups from lending to members or affiliates, require NAIC-form filings with jurat and actuarial certification, and mandate sworn funding statements for protected cells; third reading was ordered and the bill is slated to take effect 07/01/2026.
Representative White, the member from Bethel, presented the Committee on Commerce and Economic Development's recommendations on H.649, an act concerning captive insurance companies. The committee explained the measure would prohibit a risk-retention group from lending to or investing in its members or the affiliates of its members, with an explicit grandfathering clause for any loan or investment in effect prior to Jan. 1, 2026. The committee described that restriction as protecting capital and preserving solvency to safeguard policyholder funds.
The committee's amendment also aligns reporting requirements for risk-retention groups with filings used by the National Association of Insurance Commissioners (NAIC), requiring annual and quarterly statements in NAIC form, a signed jurat page, and an actuarial certificate. The bill would make those filings nonconfidential for regulated-state oversight purposes. For sponsored captive insurance companies and their protected cells, the amendment would require each protected cell to file within 30 days of commencing business a sworn statement certifying it possessed requisite funding and any required collateral, signed by officers or authorized board members.
Representative White told the House the Department of Financial Regulation and stakeholders supported the package and that the committee voted unanimously (11-0-0) to advance the bill. "The committee vote was 11 0 0, and we respectfully ask for your support," the representative said on the floor.
The bill as amended sets an effective date of July 1, 2026. The House approved the committee amendment by voice vote and ordered the bill read a third time.
Background: committee testimony came from the interim deputy commissioner of captive insurance at the Department of Financial Regulation, the president of the Vermont Captive Insurance Association, legislative counsel, and the Department of Financial Regulation commissioner. The committee said the amendments codify certain departmental practices, add transparency for multistate captives, and narrow some authorities that previously allowed limited investments in members with commissioner approval.
Next steps: third reading was ordered on the House floor; no final passage vote appears in the transcript.