With hard conditions in the traditional commercial insurance market continuing, captive insurance company formations remain very strong.

In Vermont, the largest US captive domicile with 645 captives, 30 new captives have been licensed so far in 2022, with more formations expected before the year closes.

“We expect more formations in the months ahead,” said Sandy Bigglestone, Vermont’s deputy commissioner of captive insurance in Montpelier. She added that hard conditions in the traditional market—a key driver of captive formations—are not likely to end anytime soon.

Other captive regulators agree with that assessment. With hard market conditions, “companies are reaching out of the traditional market,” said Travis Wegkamp, captive insurance director with the Utah Insurance Department in Salt Lake City.

Already, Mr. Wegkamp noted, 31 new captives have been licensed this year in Utah, with 12 captive applications pending, adding that he expects the high number of captive formations in Utah to continue in 2023. Currently, Utah has 382 captives.