(a) Any person complying with § 6906 of this title may apply to the Commissioner for a certificate of authority to do any and all insurance business comprised in §§ 902-905, 906(a)(1),(2), (4)-(15) and (b), 907 and 908 of this title and to issue annuities as defined in § 2902 of this title; provided, however, that:
(1) No pure captive insurance company may directly insure any risks other than those of any 1 or more of the following:
a. Its parent.
b. Its parent’s affiliated companies.
c. A controlled unaffiliated business.
(2) No association captive insurance company:
a. Organized as a reciprocal insurer may insure any risks that a reciprocal insurer is not permitted to insure under Chapter 57 of this title; and
b. May insure any risks other than those of the association members of its association and their affiliated companies, provided that an association captive insurance company may insure risks of any other person if the insurance for such other persons satisfies each of the following requirements:
1. The insurance lines for such other persons must be the same as are authorized by the Commissioner to be written by the association captive insurance company for its association members;
2. Such other persons conduct the same or a related or similar business as that of the association members of the association captive insurance company; and
3. The maximum amount of premiums received in any year from all such other persons cannot without the express written consent of the Commissioner exceed 50% of the gross direct premiums received by the association captive insurance company from its association members in its preceding financial year;
(3) No industrial insured captive insurance company:
a. Organized as a reciprocal insurer may insure any risks that a reciprocal insurer is not permitted to insure under Chapter 57 of this title; and
b. May insure any risks other than those of the industrial insureds of its industrial insured group and their affiliated companies, provided that an industrial insured captive insurance company may insure risks of any other person (other than a natural person in his or her individual capacity) if the insurance for such other persons satisfies each of the following requirements:
1. The insurance lines for such other persons must be the same as are authorized by the Commissioner to be written by the industrial insured captive insurance company for its industrial insureds;
2. Such other persons conduct the same or a related or similar business as that of the industrial insureds of the industrial insured captive insurance company; and
3. The maximum amount of premiums received in any year from all such other persons cannot without the express written consent of the Commissioner exceed 50% of the gross direct premiums received by the industrial insured captive insurance company from its industrial insureds in its preceding financial year;
(4) No risk retention group may insure any risks other than risks that may be insured by a risk retention group under Chapter 80 of this title;
(5) A special purpose captive insurance company may, in addition to the authority set forth in this section for captive insurance companies, provide insurance or reinsurance, or both, for such other risks as approved by the Commissioner;
(6) No captive insurance company may provide personal motor vehicle or homeowner’s insurance coverage or any component thereof;
(7) No captive insurance company may accept or cede reinsurance except as provided in § 6911 of this title;
(8) Any captive insurance company may provide excess workers’ compensation insurance to its parent and affiliated companies, unless prohibited by federal law or laws of this State or any other state having jurisdiction over the transaction, and any captive insurance company, unless prohibited by federal law, may reinsure workers’ compensation of a qualified self-insured plan of its parent and affiliated companies; and
(9) A series may elect to apply for a certificate of authority as a pure, agency, association, industrial insured, or special purpose captive insurance company; or a series may elect to be licensed as a series captive insurance company.
(b) No captive insurance company shall do any insurance business in this State unless:
(1) It is authorized by the Commissioner to do insurance business in this State under 1 of the following:
a. A certificate of authority under subsection (f) of this section; or
b. A conditional certificate of authority under subsection (g) of this section;
(2) Its board of directors, members, partners, managers, committee of managers or other governing body, or in the case of a reciprocal insurer, its subscribers’ advisory committee, holds at least 1 meeting each year in this State, provided that this requirement shall not apply to:
a. A branch captive insurance company; or
b. A captive insurance company that has 5 or more full-time employees each of whom has that employee’s principal place of employment in this State;
(3) It maintains its principal place of business in this State or, in the case of a branch captive insurance company, it maintains in this State a principal place of business in accordance with the provisions of § 6972(c) of this title; and
(4) It identifies in its application for a certificate of authority its registered office in this State and its registered agent located at such office to accept service of process on its behalf and to otherwise act as its registered agent in this State, provided that whenever such registered agent cannot with reasonable diligence be found at the registered office of the captive insurance company, the Commissioner shall be an agent of such captive insurance company upon whom any process, notice or demand may be served.
(c) (1) Before receiving a certificate of authority, an applicant captive insurance company shall file with the Commissioner a certified copy of its organizational documents, a statement under oath of its president or other authorized person showing its financial condition, and any other statements or documents required by the Commissioner.
(2) Each applicant captive insurance company shall also file with the Commissioner evidence of the following:
a. The amount and liquidity of its assets relative to the risks to be assumed;
b. The adequacy of the expertise, experience, and character of the person or persons who will manage it;
c. The overall soundness of its plan of operation;
d. The adequacy of the loss prevention programs of its insureds; and
e. Such other factors deemed relevant by the Commissioner in ascertaining whether the proposed captive insurance company will be able to meet its policy obligations.
(d) (1) Each applicant captive insurance company shall pay to the Commissioner a nonrefundable application fee of $300 for reviewing its application to determine its completeness, and a nonrefundable processing fee of $3,200 for examining, investigating, and processing its application for a certificate of authority.
(2) The Commissioner may retain legal, financial and examination services, and other expert services from outside the Department and may charge the applicant the reasonable cost of these services.
(3) The provisions of § 330 of this title apply to reviews, examinations, investigations, and processing conducted under this section.
(4) In addition to any other fee imposed or cost assessed under this section, each captive insurance company shall pay a nonrefundable license fee for the year of registration and a nonrefundable renewal fee for each year thereafter of $400.
(5) A captive insurance company that files an application for a conditional certificate of authority under subsection (g) of this section must pay the Commissioner a fee of $100.
(e) For conducting regulatory reviews, investigations, or processing, the Commissioner is authorized to retain legal, financial and examination services and other expert services from outside the Department, the reasonable cost of which may be charged against the applicant or captive insurance company.
(f) If the Commissioner is satisfied that the documents and statements that such captive insurance company has filed comply with the provisions of this chapter, the Commissioner may grant a certificate of authority authorizing it to do insurance business in this State until April 1 thereafter, which certificate of authority may be renewed.
(g) (1) Before the completion of the Commissioner's review of a captive insurance company's application materials, the Commissioner may issue a conditional certificate of authority upon the Commissioner's receipt of all of the following:
a. Satisfactory evidence of the captive insurance company's possession of the minimum required capital and surplus set forth in § 6905 of this title; and
b. The application materials required by this chapter; and
c. A statement of compliance signed by the owner of the captive insurance company stating that to the best of the owner's belief the business plan and other documents filed with the application for a conditional certificate of authority comply with all of the following:
1. All licensing requirements mandated by this chapter; and
2. Any additional requirements the Commissioner establishes by regulation or rule.
(2) The Commissioner may summarily revoke a conditional certificate of authority without legal recourse by the captive insurance company if 1 of the following applies:
a. The Commissioner is unable to verify within 6 months of the issuance of the conditional certificate of authority that the captive insurance company possesses the minimum required capital and surplus indicated on the form submitted to the Department for issuance of the conditional certificate of authority; or
b. The Commissioner determines that the business plan or other documents filed with the application for a certificate of authority do not comply with all of the following:
1. All licensing requirements mandated by this chapter; and
2. Any additional requirements the Commissioner establishes by regulation or rule.
(3) Upon the issuance of a conditional certificate of authority under this subsection, the captive insurance company shall comply with and be subject to this chapter.