Case Study Of 4.3.5 Captives In Sweden
4.3.5 Captives in Sweden
The charters of 1976 an 1977 granted three groups, SKF Re, Electrolux Re and AGA Re, the right to operate in insurance activities in Sweden.
SKF Re. and Electrolux Re. Captives were mainly involved in the reinsurance of foreign risks of companies of the group.
AGA Re on the other hand had the charter to reinsure both Swedish group and foreign company’s risks, but this charter expired in 1984. In recent years a number of Swedish groups have set up captives abroad. For example, Sinser is subsidiary of Skandia- a company jointly owned by clients of Skandia and Sinser. It is a consultancy company that provides service for Swedish groups that have established captives. Its areas of operation are Sweden, Bermudas and …show more content…
They were formed during the 1970s period with the purpose of reducing the rapidly growing cost of the insurance programmes.
As an Island in the scheduled territories interested in the development of financial services, the Isle of Man introduced captive insurance legislation in 1978. The legislation requires draft legislation produced by the Island of Man authorities, with restrictions on corporation tax captives and approval by the finance board represented by the treasurer.
The approval examines the business which the captive proposes to underwrite and is limited to those companies whose business consists solely of risks of their parent company. Although there is no minimal level of capitalisation laid down, the finance board looks at each case at its merit. The government of the Isle of Man created an attractive environment for all insurers, by the introduction of Exempt Insurance Company Act which became law in 1981. This was clearly framed with captive insurance company in mind. Since then, there have been more developments in the Isle of Man. The result has been a good deal of increase interest in new insurance companies coming to the island including captives. The list shows some captives found in Isle of …show more content…
But the growth had been slow and the market remains small. The stumbling block is the Law 12988, in force since the 1940s, which ensures that:
- No Argentina risk can be placed as direct insurance with companies located outside the country.
- Reinsurance is subject to state monopoly, on top of this, there is no special tax advantage to corporations who set up their own insurance companies.
4.3.11 Vermont Captives
Vermont took steps in 1981 to introduce in the Vermont legislative changes which not only allowed but encouraged the establishment of captives.
The special Insurer Act in Jury 1981 encouraged developments of captives in Vermont. Also in 1982 the Congress passed the Tax Equity and Fiscal Responsibility Act, which eliminated some of the tax advantages for offshore captives. Vermont is the second largest licensing jurisdiction in terms of insurance company assets, but third in terms of captives
The charters of 1976 an 1977 granted three groups, SKF Re, Electrolux Re and AGA Re, the right to operate in insurance activities in Sweden.
SKF Re. and Electrolux Re. Captives were mainly involved in the reinsurance of foreign risks of companies of the group.
AGA Re on the other hand had the charter to reinsure both Swedish group and foreign company’s risks, but this charter expired in 1984. In recent years a number of Swedish groups have set up captives abroad. For example, Sinser is subsidiary of Skandia- a company jointly owned by clients of Skandia and Sinser. It is a consultancy company that provides service for Swedish groups that have established captives. Its areas of operation are Sweden, Bermudas and …show more content…
They were formed during the 1970s period with the purpose of reducing the rapidly growing cost of the insurance programmes.
As an Island in the scheduled territories interested in the development of financial services, the Isle of Man introduced captive insurance legislation in 1978. The legislation requires draft legislation produced by the Island of Man authorities, with restrictions on corporation tax captives and approval by the finance board represented by the treasurer.
The approval examines the business which the captive proposes to underwrite and is limited to those companies whose business consists solely of risks of their parent company. Although there is no minimal level of capitalisation laid down, the finance board looks at each case at its merit. The government of the Isle of Man created an attractive environment for all insurers, by the introduction of Exempt Insurance Company Act which became law in 1981. This was clearly framed with captive insurance company in mind. Since then, there have been more developments in the Isle of Man. The result has been a good deal of increase interest in new insurance companies coming to the island including captives. The list shows some captives found in Isle of …show more content…
But the growth had been slow and the market remains small. The stumbling block is the Law 12988, in force since the 1940s, which ensures that:
- No Argentina risk can be placed as direct insurance with companies located outside the country.
- Reinsurance is subject to state monopoly, on top of this, there is no special tax advantage to corporations who set up their own insurance companies.
4.3.11 Vermont Captives
Vermont took steps in 1981 to introduce in the Vermont legislative changes which not only allowed but encouraged the establishment of captives.
The special Insurer Act in Jury 1981 encouraged developments of captives in Vermont. Also in 1982 the Congress passed the Tax Equity and Fiscal Responsibility Act, which eliminated some of the tax advantages for offshore captives. Vermont is the second largest licensing jurisdiction in terms of insurance company assets, but third in terms of captives