The submitted application should include the following:
The plan of operation submitted with the License Application must include an actuarial report or feasibility study prepared by a qualified independent actuary. The content for the plan of operation is set forth in the Application Form. Any proposed changes to the plan of operation subsequent to licensing shall be submitted to the Superintendent thirty days before becoming effective.
Letters of Credit (PDF Format) can be used to meet capital and surplus requirements.
After review of the proposed charter and by-laws by the New York State Department of Financial Services, the applicant will submit an executed copy of the charter. For stock insurers, an incorporation tax of one-twentieth of one percent of the par value of capital stock must be submitted to the New York State Department of Financial Services (New York Tax Law -- Section 180) at this time. The executed copy of the charter will be forwarded by the Department of Financial Services to the New York State Attorney General for recording and the Department of Financial Services will issue a Certificate of Incorporation to the captive company. After the company has been incorporated it must submit a copy of its by-laws, which shall be certified by the corporate secretary or assistant corporate secretary.
The License Application requires submission of biographical affidavits for directors and executive officers of the proposed captive insurer. Copies should be made, completed, executed and submitted with the Application. Each Biographical Affidavit (PDF Format) form should be filled out entirely.
After incorporation, the applicant must submit:
The captive insurance company shall submit a Power of Attorney (PDF Format) designating the Superintendent as agent for service of process. This shall be accompanied by a Certificate of Designation (PDF Format) naming the person to whom the Superintendent can forwarded any process served upon him. A certified copy of a Resolution of the Board of Directors (PDF Format) authorizing both the appointment and the designation is also required.
All of the books and records of the captive insurance company must be maintained at the insurer’s principal office, which shall be located in New York. Books and records consist of all information and files necessary to perform an audit or examination of the captive insurer.
Three directors are required. The Board of Directors must hold at least one meeting in New York each year. In addition, two members of the Board must be residents of New York.
The manager of a captive insurance company shall be a person or firm resident in New York and shall be either: (1) licensed as an agent or broker in New York; or (2) approved by the Superintendent to act as a captive manager.
All captive insurance companies must file the New York Captive Financial Statement (PDF Format) with the DFS Captive Group by March 1st. An independent certified public accountant must opine on the financial condition of the captive insurance company on an annual basis. Loss reserves and loss expense reserves must be reported in the annual statement.
Tax filings and payments are made to the New York State Tax Department in accordance with the provisions of Article 33 of the New York Tax Law. Captive insurers are subject to a premium tax (referred to as a "franchise tax" under NY Tax Law) as set forth in Section 1502-b of the Tax Law. Unless capital is increased, Licensed captive insurers are not taxed under any other provision of the New York Tax Law.
Captive insurance companies must also pay an assessment pursuant to Section 332 of the New York Insurance Law, which is used to defray the operating expenses of the New York State Department of Financial Services. The assessment is based upon the direct premiums written in New York only; non-New York and reinsurance premiums are not used in calculating the assessment. The level of the assessment varies from year-to-year. The approximate rate, based upon the latest assessment available, is .40% of New York direct premiums written. A Report of Premiums is filed on an annual basis with the New York State Department of Financial Services.
Each captive shall be subject to an examination at least once every five years.