Tennessee: The volunteer state proves its captive appeal

Carter Lawrence, commissioner of the Tennessee Department of Commerce and Insurance, reflects on the latest 2023 captive figures for Tennessee and explains why the volunteer state is a first-in-class destination for captives

 

In Tennessee, our focus on responsible regulation, our modern captive insurance statute, and our roster of seasoned professionals has allowed us to provide stability to captive domicile managers they might not find elsewhere.

That is why I am pleased to share that the Tennessee Department of Commerce and Insurance’s captive insurance section has once again shown positive growth for the year 2023.

Tennessee saw increases in three major areas in 2023:

  • We saw a 13% growth in premiums paid to over $2.4 billion.
  • Our number of pure or single-parent captives grew by nearly 12% to 163. The number of registered cells increased by over 9% to 575.
  • We have four remaining applications being processed which, when finalised, will be included in our total 2023 tally.

It is with great pride that I say our fantastic team of analysts and our attention to regulation are the leading causes for this advancement.

The reliability our team provides is becoming more and more important as the insurance market undergoes seismic shifts.

Today, companies large and small are learning how they must adapt to the emerging technological advances created by artificial intelligence, driverless cars, robotics and cyber-attacks, while global factors such as macroeconomics, regional instabilities and severe weather events are creating momentous changes in the insurance industry that have contributed greatly to the hardening market.

As many are learning, captive insurance is a valuable tool that can help mitigate costs of traditional risks such as property and casualty, liability, or non-traditional risks such as cyber risks, credit risks and environmental liability, among others.

In Tennessee, you’ll find we have some experience with creating an environment that’s conducive to captive insurance.

Since 1978, Tennessee has extended a warm welcome to all captive managers. As one of the first states with legislation that enables the creation of captive insurance domiciles, Tennessee is now a first-in-class destination for captive insurance managers.

If you haven’t visited us yet, I encourage you to come see all the great things that are happening here and meet our team in person.

After a significant modernisation to our captive statutes in 2011, Tennessee has seen steady and significant growth in our captive market.

In fact, in the most recent few years, we’ve seen over 37% increase in overall risk bearing entities, bringing our total count to 718.

This rise in regulated entities has increased our premium volume by over 40%. This growth is also realised in the private sector.

We have an outstanding, growing network of service providers in Tennessee that have all contributed greatly to the success of Tennessee as a domicile.

These factors are leading more captive owners to choose Tennessee as their preferred domicile for captives.

Why choose Tennessee?

Aside from our central location, amenities and world-class cities, our captive insurance team members pride themselves on being responsive, modern and attentive to the needs of captive managers and owners.

Led by captive insurance section director Mark Wiedeman and our team of 15, we are an accomplished and award-winning team with decades of collective experience.

Our focus is firmly on providing good, reliable regulation, but more importantly, world-class customer service. We are responsive and knowledgeable. Most of us are certified public accountants and we’re all graduates of the Associate of Captive Insurance programme administered by the International Center for Captive Insurance Education.

Moreover, our department is just one piece of a larger team that includes the support of Tennessee Governor Bill Lee and the members of Tennessee General Assembly, who are working together to ensure Tennessee’s economy remains vibrant and healthy. We think your captive should call Tennessee home.

12 August 2024
5-6 November 2025

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