§ 27-43-4 - Minimum capital. - Rhode Island Statutes

SECTION 27-43-4

   § 27-43-4  Minimum capital. – (a) No subsidiary captive insurance company, association captive insurancecompany incorporated as a stock insurance company, or industrial insuredcaptive insurance company incorporated as a stock insurance company shall beissued a license unless it possesses and after this maintains unimpaired paidin capital of:

   (1) In the case of a subsidiary captive insurance company,not less than one hundred thousand dollars ($100,000);

   (2) In the case of an association captive insurance companyincorporated as a stock insurance company, not less than four hundred thousanddollars ($400,000); and

   (3) In the case of an industrial insured captive insurancecompany incorporated as a stock insurance company, not less than two hundredthousand dollars ($200,000). The capital may be in the form of cash or anirrevocable letter of credit issued by a bank chartered by the state of RhodeIsland or a member bank of the Federal Reserve System and approved by thecommissioner.

   (b) The commissioner may prescribe additional capital basedupon the type, volume, and nature of insurance business transacted, whichcapital may be in the form of a irrevocable letter of credit issued by a bankchartered by the state of Rhode Island, or a member bank of the Federal ReserveSystem.

   (c) No captive insurance company may pay a dividend out of,or other distribution with respect to, capital or surplus, in excess of thelimitations set forth in § 27-43-12, without the prior approval of thecommissioner. Approval of an ongoing plan for the payment of dividends or otherdistributions shall be conditioned upon the retention, at the time of eachpayment, of the capital or surplus in excess of amounts specified by, ordetermined in accordance with formulas approved by, the commissioner.