Domicile selection is one of the most important factors to consider when forming a captive insurance company. The Oxford Risk Management team is prepared to assist our clients and their advisors in making a determination of various domiciles best suited to meet their goals and objectives – regardless of location. Items to consider when selecting the most appropriate domicile will include: captive statute, regulatory climate, taxation, infrastructure, compliance, investment objectives, and overall perception of the structure. It is also important to analyze first year implementation and ongoing management costs to remain compliant in the jurisdiction you select for your captive insurance company.
There are many excellent jurisdictions to consider, including domestic and international domiciles. In addition to the domicile attributes noted above, you may be required to travel to the jurisdiction to perform any implementation activities and physically form the captive insurance company. Additionally, many jurisdictions require the captive to have at least one meeting per year within the jurisdiction, along with a local registered agent and a physical address. These requirements can often be handled by the captive management and legal service providers.
Historically, the vast majority of new captive insurance companies created worldwide have been established in international domiciles. Today, the majority of U.S. jurisdictions have captive licensing laws and have either approved new captive legislation or amended their existing captive statutes – making it possible for the business owner to enjoy many of the benefits previously associated only with international domiciles. Business owners may prefer the advantages of establishing their captive in the U.S., and there are now many attractive options to consider.
Oxford Risk Management has the ability to implement captives in multiple domiciles. While many of the leading domiciles have favorable laws, no one jurisdiction offers the best solution for every client and every captive. Oxford’s expert team of independent, Best-In-Class advisors has the regulatory relationships, experience and knowledge to assist in the selection of the most appropriate domicile to generate the most favorable risk management, compliance, profitability, tax and legal results.
We can also help to evaluate the effectiveness of existing captive insurance structures for business owners contemplating re-domiciling their captive. Given the current climate of increased scrutiny of international business arrangements, many clients have elected to explore onshore captive formation for enhanced peace of mind. Alternatively, many clients have elected to structure their captive company in adherence to U.S. regulatory requirements in a more cost-efficient international domicile.