Serio: Connecticut Ripe for Growth Spurred by New Captive Law

The implementation of a new captive insurance law will boost the traditional insurance market in Connecticut, said former New York Insurance Superintendent Gregory V. Serio, who's just launched a new captive management firm to focus on Connecticut.

"There's so much interplay between captives and traditional carriers, people haven't always had an appreciation for that," said Serio, who co-authored New York's captive law and oversaw the licensing of the Empire State's first 45 captives.

Serio and former U.S. Senator Alfonse M. D’Amato have launched Hartford, Conn.-based Charter Risk Management Services LLC, which will cater to captives formed under the new Connecticut captive law. Connecticut attorney Thomas F.X. Hodson, the former general counsel at the AIX Group and grandson of reinsurance broker G.L. Hodson, will serve as president and chief executive officer of Charter Risk.

Charter Risk is a joint venture between Hodson and the risk management firm Compass Company Consultants LLC, a risk and insurance management subsidiary of Park Strategies LLC. D’Amato and Serio are principals in Park Strategies, a consulting and lobbying firm (Best's News Service, March 12, 2012.)

"The potential in Connecticut is great, not only with the number of Connecticut companies that currently have captives in other domiciles, but those who haven't experienced the benefits of a captive ... it will encourage a lot of companies to form a captive for their risk financing," Serio said.

The Connecticut Department of Insurance oversees $156 billion in premiums, the second-largest market in the country behind New York, the department said.

Connecticut's captive law was approved in 2008, but funding for necessary regulatory positions wasn't included until last month. Gov. Dannel Malloy included funding for three full-time captive regulators in his proposed 2012 budget, which includes a total of 18 new insurance regulatory positions (Best's News Service, Feb. 22, 2012).

Charter Risk will serve as administrator of the new Connecticut Captive Insurance Association, a not-for-profit trade association organized to assist in the development of a successful captive insurance market in Connecticut.

The Connecticut Captive Insurance Association will be an important element to Connecticut's success as a captive domicile, Serio said, noting that all the successful captive domiciles have had three main ingredients: a good captive law, the support of lawmakers plus insurance and economic development officials, and a strong trade association.

Charter Risk will seek regulatory approval as a captive manager in the state of Connecticut.

In 2005, Serio joined the staff at Manhattan's Park Strategies, a consulting and lobbying firm run by D'Amato (BestWeek, Jan. 4, 2005).

D'Amato, a Republican, served as U.S. senator from New York from 1981 to 1999.

According to OpenSecrets.org, the Park Strategies had $3.8 million in lobbying income in 2011, from clients ranging from defense contractors to real estate firms to casinos.