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Captive Standard (Summer 2024)

Tuesday, July 09, 2024 10:53 AM | Admin Impact (Administrator)


 As anyone who witnessed the Tennessee Volunteers baseball team's magnificent run to a national title in the College World Series can attest, teamwork, attention to detail, and dedication are crucial to success. 

You'll find a teamwork-oriented mindset throughout the Tennessee Department of Commerce & Insurance's Captive Insurance section. It is one of the main reasons why Tennessee stays at the forefront of the captive insurance industry. While other states may or may not create similar legislation, it's our teamwork combined with our business friendly environment along with our quality of life that make the biggest difference when it comes to captive insurance managers.

Our commitment to teamwork includes our partnership with the Tennessee Captive Insurance Association (TCIA). Each year we review the state statutes every year with the TCIA to ascertain whether updates are needed. Sometimes the Department chooses to update the legislation and sometimes the TCIA will pass legislation on their own separately from the Department but with our support. For example, the TCIA successfully ran a bill during the 2024 legislative session that updated statutes related to examinations, in-person board meeting requirements, materiality for business plan changes and a number of incorporators required to form a captive in Tennessee as well as language addressing agency captives.

Working together, Tennessee can provide the support, cooperation, and willingness to go the extra mile that makes the difference — and makes everyone a winner.

Have a safe and wonderful summer!

Commissioner Carter Lawrence


I hope you all are enjoying the beginning of a healthy and happy summer. You may or may not be aware of some of our recent changes and updates effecting our team, so I'd like to take a moment to fill you in.

We have one new hire, Kent Ussery. Kent is joining the team after making a career as a CPA in both public accounting and corporate accounting. I am happy to welcome him to the team!

We also have some new policies adopted from the most recent legislative session. I invite you to reach out to us if you have any questions or clarifications about these policy changes. The updates to the statutes took effect on Monday, May 13, 2024 and are as follows:

1. Payment of 3rd party actuarial reviews

Contract reviews of feasibility studies are required in certain circumstances. These reviews are considered a form of examination under § 56-13-109, the cost of which is the responsibility of the company. Failure to pay these costs are grounds for the assessment of fines and/or penalties under section § 56-13-120 or revocation under section § 56-13-110.  It is now the policy that if a contract review of a feasibility study is determined necessary as part of the application process, the Certificate of Authority or approval to operate as a licensed insurance entity in Tennessee will be withheld until confirmation is received by the Department that the invoice for said review has been paid. This policy also applies even if the captive elects not to form after the initial review of the application.

2. Elimination of the Depository Agreement requirement

The new policy eliminates the requirement for the depository agreement for captive formations and existing companies except in the case of Risk Retention Groups (RRGs). This policy will impact both current and future applications as well as depository agreements already in place. Below is the process and particulars of the policy and its accompanying requirements.

To facilitate the elimination of depository agreements, the Captive Department of the TDCI has implemented the following processes:

Requirements for new applications:

A confirmation of account setup and initial capitalization balance must be sent directly by the bank during the application process. No screenshots will be accepted. The bank may use whatever form is appropriate for their institution. Confirmations can be sent directly to our captive inbox at Captive.Insurance@tn.gov or by mail at

Davy Crockett Tower

ATTN: Captive Section

500 James Robertson Parkway, 10th Floor

Nashville, TN 37243-1130

Requests to terminate Depository Agreements from existing accounts:

A request to cancel an existing Depository Agreement must be made in writing and approved by the Department.

Components of a request:

Letter indicating that the company would like to cancel the Depository Agreement.

Include the name of the institution that will house the funds; if institution will be changing, include both the current and requested institution.

Written confirmation/acknowledgement, signed by an officer, that minimum statutory capitalization amount will remain unencumbered and unrestricted.

Contact information of the institution where funds are held.

Confirmation of balances must be sent within 20 days of setup or transfer. This can be done by sending a bank statement in a PDF or similar format. Screenshots will not be accepted.

If you have any questions, please don't hesitate to reach out to us with them. We will be happy to cover any questions you have about your captive or the regulatory process.

Captives Director Mark Wiedeman


We continue to participate in conferences all over the country. Stop by our booth to say hello at these upcoming events.

  • August 12-15 — Vermont Captive Conference in Burlington, VT
  • September 9-10 — Bermuda Captive Conference in Hamilton, Bermuda
  • September 22-24 — SIIA National Conference in Scottsdale, AZ


Would your agency or company like to have an in-person or virtual Meet and Greet with the Captive Section? Contact Director of Business Development Michael Schulz at Michael.Schulz@tn.gov or 615-532-8382.


The Captive Standard is the Captive Section's quarterly newsletter for industry professionals in Tennessee. If you have colleagues who wish to receive these newsletters, please ask them to sign up for our email list.

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