2023 District of Columbia Code › Title 31 - Insurance and Securities › Chapter 39A - Captive Insurance Companies (2004) › Subchapter I - General › § 31–3931.09. Application requirements

§ 31–3931.09. Application requirements.
(a) A captive insurer shall apply to the Commissioner for a certificate of authority. If one or more protected cells are established as separate legal entities, each protected cell shall apply for a certificate of authority. The application shall include:
(1) A proposed copy of the organizational documents of the captive insurer if the captive insurer has not been organized, or a certified copy of the organizational documents and evidence of good standing if the captive insurer has been organized;
(2) A pro forma financial statement for the captive insurer that has been prepared by a certified public accountant; and
(3) Any other statements or documents that the Commissioner requires to be filed with the application.
(b) A captive insurer shall include in its application for a certificate of authority evidence of:
(1) The amount of liquidity of its assets relative to the risks to be assumed by the captive insurer;
(2) The expertise, experience, and character of the persons who will manage the captive insurer;
(3) The overall soundness of the plan of operation of the captive insurer;
(4) The adequacy of the programs that the captive insurer is providing for loss prevention by its parent or member organizations, as applicable;
(5) Minimum capital and surplus requirements as set forth in § 31-3931.05(a) and (f) [apparently intended to be a reference to § 31-3931.09(a) and (f)]; and
(6) Such other information considered to be relevant by the Commissioner in ascertaining whether the proposed captive insurer will be able to meet its policy obligations.
(c) An application by a captive insurer or protected cell for a certificate of authority shall include a nonrefundable application fee to be determined by the Commissioner. The Commissioner may require the applicant to retain independent legal, financial, and examination services from outside the Department to review and make recommendations regarding the applicant’s qualifications, and to submit those reports and recommendations to the Commissioner for his or her review. The cost of those services shall be paid by the applicant.
(d) If the Commissioner determines that the documents and statements filed by the captive insurer or protected cell of a captive insurer are complete and satisfy the requirements for a certificate of authority, the Commissioner shall issue a certificate of authority to the captive insurer or protected cell within 30 days. Each certificate shall be renewed each year not later than the 30th day of April succeeding the date of its issuance. The Commissioner may impose an administrative fine or penalty on a captive insurer or protected cell that fails to renew its certificate of authority before August 1. The Commissioner may suspend or revoke the certificate of authority of a captive insurer or protected cell that fails to renew its certificate of authority on or after August 1.
(e) A captive insurer shall pay a fee to be established by the Commissioner for the issuance of a certificate of authority and an annual fee to be established by the Commissioner for the renewal of its certificate of authority. A captive insurer may be required to pay a fee for one or more protected cells.
(f) A captive insurer shall include its strategic business plan with its application for the issuance of its certificate of authority. If the captive insurer intends to make any material or substantive changes to its strategic business plan, the captive insurer shall file a copy of the amended strategic business plan with the Commissioner for prior written approval.
(g)(1) Documents, materials, and other information submitted pursuant to this section shall be confidential and shall be exempt from any otherwise applicable freedom of information law, including Chapter 5 of Title 2 [§ 2-531 et seq.], public records law, public records disclosure law, or other similar statute and shall not be subject to subpoena or discovery or admissible in evidence in a private civil action, and shall not be divulged to any person except either as provided for in this subsection or with the written consent of the captive insurer or protected cell.
(2) The Commissioner may use documents, materials, and other information submitted pursuant to this section in the furtherance of any regulatory or legal action brought as a part of the Commissioner's official duties.
(3) To assist in the performance of the Commissioner's duties, the Commissioner may share documents, materials, or other information submitted pursuant to this section with state, federal, and international regulatory agencies, the National Association of Insurance Commissioners, including its affiliates and subsidiaries, and with state, federal, and international law enforcement authorities; provided, that the recipient agrees in writing, and has the legal authority to so agree, to maintain the confidentiality of the documents, materials, and other information.
(Mar. 17, 2005, D.C. Law 15-262, § 10, 52 DCR 1205; Mar. 10, 2015, D.C. Law 20-203, § 2(f), 61 DCR 12572.)
Section References
This section is referenced in § 31-3932.03 and § 31-3932.04.
Effect of Amendments
The 2015 amendment by D.C. Law 20-203 substituted “protected cell” for “segregated account” throughout the section; substituted “protected cells” for “segregated accounts” in (e); and added (g).
Emergency Legislation
For temporary (90 day) addition of section, see § 10 of Captive Insurance Company Emergency Act of 2004 (D.C. Act 15-640, November 30, 2004, 52 DCR 1238).