Template-Type: ReDIF-Article 1.0
Author-Name: Erik Johnson; Anne Kleffner
Author-Workplace-Name: University of Calgary
Title: The Captive Insurance Opportunity in Alberta: Drivers of Success in Captive Domiciles
Abstract: The annual economic impact from captive insurance companies in Alberta could range as high as C$139 million, but changes to the province’s current policies are necessary for the industry ideally to grow to 210 captives by 2033, up from the 20 licensed captives as of July 2024.
Alberta’s Captive Insurance Companies Act came into force in July 2022, making it the second province after British Columbia to permit captive insurance companies. Diversifying Alberta’s economy and building the province’s financial sector are important parts of the rationale behind Alberta’s captive insurance legislation, but much remains to be done.
To determine how Alberta can build on its early success, this paper extracts lessons from studies on captive insurance in Bermuda, Delaware, North and South Carolina, Vermont and Hawaii that measured captives’ economic benefits. Economic impact estimates per captive are as high as C$564,400 annually, demonstrating how a healthy captive market positively impacts a domicile. For example, in 2016, Delaware’s 1,081 captives generated US$360 million in economic activity, US$109 million in labour income and 2,573 jobs.
Journal: The School of Public Policy SPP Briefing Papers
Volume: 17
Issue: 16
Year: 2024
Month: October
File-URL: https://www.policyschool.ca/wp-content/uploads/2024/10/FMK-20-CaptiveOpportunityAlberta-Final.pdf
File-Format: Application/pdf
Handle: RePEc:clh:briefi:v:17:y:2024:i:16