Global Fiber-Based Packaging, Pulp and Paper Products Leader International Paper Relocates Its Captive Insurance Company From Vermont To TennesseeDepartment Celebrates 700th Risk-Bearing Entity Milestone
NASHVILLE — The Tennessee Department of Commerce & Insurance’s (TDCI) Captive Insurance Section and Memphis-based global fiber-based packaging, pulp and paper products leader International Paper proudly announce the relocation of International Paper’s captive insurance company from Vermont to Tennessee.
The arrival of International Paper’s captive insurance company is a milestone for Tennessee as it represents the Volunteer State’s 700th risk-bearing captive insurance entity. Tennessee now has 211 standalone captives and 489 cell captives. Tennessee is currently ranked as the 7th largest captive domicile in the United States and 12th largest domicile in the world.
Captive insurance companies, which are regulated by TDCI, are formed primarily as a financing vehicle to self-insure the related or affiliated business risks of its owners. A risk-bearing entity is any formation type of a captive insurance company, including cell captives.
TDCI and International Paper leaders recently celebrated the relocation during a brief socially distanced event in Nashville. The event was highlighted by a video message from Tennessee Governor Bill Lee and the presentation of a ceremonial license by TDCI Captive Insurance Section Director Belinda Fortman to David Arick, International Paper Assistant Treasurer, Global Risk Management and board member of RIMS, the risk management society.
“I commend International Paper for choosing to relocate their captive insurance company to Tennessee and reaffirming their commitment to their global headquarters’ home state,” said Governor Lee. “Tennessee remains committed to ensuring a business friendly and commonsense regulatory environment.”
“We are excited to celebrate this milestone with the State of Tennessee, Governor Lee and Commissioner Lawrence, and look forward to extending our relationship with Director Fortman and her captive insurance team. We have worked with the state for the past six years on our second captive and have a lot of confidence in the state as a fair and effective regulator. As a Memphis-based company, moving our captive to Tennessee will streamline administration and reduce operating costs,” said David Arick, International Paper Assistant Treasurer, Global Risk Management.
Captive insurance companies have found a receptive home in Tennessee for decades. In 1978, Tennessee was one of the first states to adopt captive legislation. After its leaders modernized the state’s captive rules in 2011, Tennessee emerged as a first choice for companies looking to create a captive insurance company. Tennessee is known for its flexible and responsive Captive Section which is dedicated to serving the needs of its captive companies.
“The creation of the 700th risk-bearing entity is an event that we proudly share with Governor Lee’s team and the entire State of Tennessee,” said TDCI Commissioner Carter Lawrence. “Governor Lee’s leadership and continued focus on ensuring Tennessee is a top domicile for captive insurance companies has helped attract new captive insurance companies to Tennessee and make the Volunteer State a place where businesses want to start a captive insurance company or relocate their existing captive insurance company from other states and from countries around the world.”
Tennessee captives have written over $6.4 billion in premium and collected over $16 million in taxes and fees. The captive insurance sector has an estimated economic impact in Tennessee of $31 million in direct annual spending and employs more than 100 full-time professionals.
“International Paper’s relocation of its captive insurance company is the latest in a string of accomplishments for TDCI’s Captive Insurance Section and proof that Tennessee has the right mix of leadership and regulation to attract globally recognized brands,” said TDCI Captive Insurance Section Director Belinda Fortman. “Tennessee has proven that our business friendly environment combined with a stable and predictable regulatory environment make us the ‘gold standard’ of the South.”
“This is very exciting news for Tennessee, and it represents the culmination of years of effort by the Tennessee General Assembly, the Department of Commerce and Insurance and the members of the captive insurance industry in Tennessee all working together in a productive public/private partnership. The captive market is as strong as ever in Tennessee and TCIA looks forward to many more captives being formed in Tennessee in the coming years,” said Tennessee Captive Insurance Association President Kevin Doherty.
Photo caption (Left to right): TDCI Captive Section Director Belinda Fortman, International Paper Assistant Treasurer David Arick, TDCI Commissioner Carter Lawrence and Tennessee Captive Association President Kevin Doherty celebrate International Paper's relocation of its captive insurance company to Tennessee.