HB 348: Insurance; expand lines of insurance or reinsurance in which a limited purpose subsidiary and captive insurance company may engage

Under current Georgia law, a limited purpose subsidiary of a domestic insurer can only reinsure risks of the insurer that created it, and captive insurance companies (insurers formed by a business to insure its own or related risks) are limited to four specific lines: casualty, marine and transportation, property, and surety. House Bill 348 changes both of these limits. The bill lets a limited purpose subsidiary be owned by outside 'sponsors' as well as its original parent insurer, and allows it to reinsure any line of insurance those sponsors are authorized to write, not just the parent's risks. It also rewrites the definition of a captive insurer's 'controlled unaffiliated business' to cover a broader range of contractual relationships and investors. Most significantly, it removes the fixed list of insurance lines a captive insurer may write and instead lets the Commissioner of Insurance approve any line of insurance or reinsurance deemed reasonable. The law would take effect on the first day of the month after the Governor signs it.

• Adds a definition of 'sponsor' to the limited purpose subsidiary law, covering any entity that helps form, invest in, or fund such a subsidiary.
• Allows a limited purpose subsidiary to be owned by outside sponsors, not just the domestic insurer that created it, and to reinsure any line those sponsors are authorized to write.
• Removes the old rule limiting a limited purpose subsidiary to reinsuring only the risks of its organizing insurer.
• Broadens the definition of 'controlled unaffiliated business' for captive insurers to include reinsurance and risk-sharing relationships and direct or indirect investors.
• Eliminates the fixed list of four insurance lines captive insurers could write and lets the Commissioner of Insurance approve any line of insurance or reinsurance deemed reasonable.

Domestic stock and mutual insurance companies that form limited purpose subsidiaries, outside investors or 'sponsors' who help finance those subsidiaries, businesses that own captive insurance companies to insure their own risks, and the Georgia Commissioner of Insurance, who gains new approval authority over lines of coverage.

Insurers and businesses that use captive or subsidiary structures would gain more flexibility to bring in outside investors and write a wider range of coverage, potentially expanding access to specialized insurance products in Georgia, while shifting more line-by-line approval decisions to the Commissioner of Insurance's discretion.

• Section 1 rewrites O.C.G.A. § 33-14-103 to define 'sponsor' and permit limited purpose subsidiaries to be owned by sponsors, not just the organizing reinsurer, expanding permitted reinsurance lines.
• Section 1 also deletes the requirement that a limited purpose subsidiary may reinsure only the risks of its organizing domestic reinsurer.
• Section 2 revises the O.C.G.A. § 33-41-2 definition of 'controlled unaffiliated business' to cover reinsurance, risk-sharing, or other contractual relationships and direct or indirect investors in a pure captive insurer.
• Section 3 rewrites O.C.G.A. § 33-41-3(a) to remove the enumerated list of casualty, marine and transportation, property, and surety lines, letting captive insurers engage in any line the Commissioner deems reasonable.
• Section 4 sets the effective date as the first day of the month following the Governor's approval or the bill becoming law without signature.

1. 2025-05-14Effective Date 2025-06-01
2. 2025-05-14Act 258
3. 2025-05-14House Date Signed by Governor (Cámara de Representantes)
4. 2025-04-07House Sent to Governor (Cámara de Representantes)
5. 2025-03-28Senate Passed/Adopted (Senado)
6. 2025-03-28Senate Third Read (Senado)
7. 2025-03-20Senate Read Second Time (Senado)
8. 2025-03-18Senate Committee Favorably Reported (Senado)

• Bruce Williamson (R, HD-112)Patrocinador principal
• Eddie Lumsden (R, HD-012)
• Steve Tarvin (R, HD-002)
• James Burchett (R, HD-176)
• Carolyn Hugley (D, HD-141)
• Darlene Taylor (R, HD-173)
• Larry Walker (R, SD-020)

1. AprobadaVotación: Cámara de Representantes4 de marzo de 2025

   168 a favor, 0 en contra (7 sin votar, 5 ausentes)

   Passage: House Vote #159

2. RechazadaVotación: Senado28 de marzo de 2025

   18 a favor, 32 en contra (2 sin votar, 4 ausentes)

   Adoption Of Amendment #1 By The Senator From The 2nd: Senate Vote #324

3. RechazadaVotación: Senado28 de marzo de 2025

   19 a favor, 31 en contra (2 sin votar, 4 ausentes)

   Adoption Of Amendment #2 By The Senator From The 9th: Senate Vote #325

4. AprobadaVotación: Senado28 de marzo de 2025

   47 a favor, 2 en contra (3 sin votar, 4 ausentes)

   Passage: Senate Vote #326

• insurance regulation
• captive insurance companies
• Georgia Department of Insurance
• business insurance law