Hawaii Senate Bill SB166

Hawaii 2026 Regular Session

• Introduced: 1/15/25
• Refer: 1/17/25

Caption

Relating To Insurance.

Impact

If enacted, SB166 would significantly affect how captive insurance companies operate within Hawaii. The bill aims to reduce the regulatory burden on these entities by allowing them to bypass certain examinations if they prove their compliance and financial health. This flexibility could encourage the establishment and operation of captive insurance companies in Hawaii, potentially boosting the state's economy through increased insurance options and business activities.

Summary

SB166, introduced in the 33rd Legislature of Hawaii, focuses on the regulation of captive insurance companies. The bill amends Section 431:19-108 of the Hawaii Revised Statutes, allowing certain captive insurance companies, particularly those not classified as risk retention captive insurance companies, to apply for certificates of exemption from regular examinations. This exemption would be granted if the companies meet specific criteria, including satisfactory completion of prior examinations and maintaining compliance with financial reporting requirements.

Contention

However, the bill is not without its points of contention. Critics may argue that easing examination requirements could lead to decreased oversight and potential financial instability within captive insurance sectors. Concerns may be raised regarding consumer protection and the sufficiency of current regulations to ensure that these companies are financially sound and capable of meeting their obligations to policyholders. This debate encapsulates a broader discussion about the balance between fostering business growth and maintaining rigorous regulatory practices.