It’s probably too late for 2026 legislative session, but by this time next year, a newly formed Florida group hopes it will be well on its way toward a new set of law
s that will help Florida become a powerhouse domicile for captive insurance companies.
“The goal is to have 200 captives in Florida within five to 10 years—hopefully, five years,” sai
d Andre Teixeira, chairman of the Florida Captive Insurance Association, which was formed only last summer.
Ultimately, Florida corporations could save money by having some control over premiums
with their own captives, which often face less-stringent surplus requirements. Or companies could use a planned captive as leverage with insurance carriers to reduce premiums or avoid higher premiums at renewal, Teixeira said.
Landing 200 captives would be quite a change for Florida, which now has barely a handful. To reach its goal, the association has met with the state Office of
Insurance Regulation leaders and with legislators. The association wants state lawmakers to slash t
he premium tax on captives—from the current 1.75% on gross premiums to something more like the 0.3% to 0.4% seen in captive-heavy states like Vermont, North Carolina and Tennessee.
Those states have long touted their friendliness toward captives. Vermont reported 677 captives at the end of last year. North Carolina had some 293 and Tennessee noted 182, according to those states’ insurance regulators.
Teixeira knows those numbers well. He is executive vice president and chief financial officer of The Graham Companies, a major south Florida real estate develop
r and landowner. The companies, like most businesses and homeowners in Florida, faced escalating property and liability insurance premiums in the e
Watch More Image Part 2 >>>
arly 2020s. The Graham Companies’ annual premiums reached as high as $9 million at one point.
“And we had no claims! That really hurt,” he said.
Company leadership had hoped to launch its own captive in Florida. But with Florida’s relatively hefty premium tax The Graham Companies found it was more economi
cal to build its insurance arm in Utah, a state that has no premium tax on captives—just a $7,500 annual fee.
But that meant having a physical presence in Utah and paying Utah accountants and attorneys.
“We’d like to shift those dollars back to Florida,” he added.
Another incentive for the establishment of more Florida-based captives is the fact that Florida authorities have been aggressive about enforcing a separate, 5
.3% tax on insurance procured outside the state without the assistance of a Florida-based broker or insurance agent, explained Ben Stearns, attorney and secretary of the Flori
da Captive Insurance Association. He recently wrote about the association’s plans in Captive International.