Regulatory Environment
Hawaii captive insurance companies are governed by Chapter 431, Article 19, of the Hawaii Revised Statutes. The State Legislature regularly reviews this code to ensure that it meets the needs of Hawaii’s current and prospective captive owners.
The Statute allows for five classes of captive insurance companies, as shown below.
Hawaii’s captive insurance companies may write both parent-related and unrelated businesses on a direct and/or reinsured basis. The classes permitted are casualty, auto, marine, property, and surety, although other lines may be allowed upon application to the Insurance Commissioner.
The Captive Insurance Branch of the State of Hawaii Insurance Division is headed by the Captive Insurance Administrator, who, along with an examiner and staff, is responsible for license recommendation and ongoing regulation of captive insurance companies.
- Class 1: Pure captive that writes business only as a reinsurer $100,000
- Class 2: A pure captive that can be a reinsurer and/or a direct writer $250,000
- Class 3: An association or risk retention captive $500,000 (RRG or Assoc.)
- Class 4: A sponsored captive $500,000
- Class 5: A reinsurance captive at the discretion of the Insurance Commissioner
The amounts shown above are minimum statutory capital amounts. Additional contributed capital/surplus may be required depending upon the lines of cover written, the retentions within the captive, the financial position of the parent, loss payout patterns, etc. The exact amount required should be discussed with the Captive Insurance Administrator.
Please consult with your legal advisors to become familiar with all legal requirements, including those outside of the captive-specific laws and regulations.
The State of Hawaii Insurance Division maintains an excellent website. This site gives details on Captive Insurance Legislation and regulation. The application and approval process are also available in their Captive Insurance Branch Section.
For more information on Hawaii’s legislation, regulations, and other issues, please contact your insurance advisor.