Louisiana is opening its doors to captive insurers, and the Department of Insurance has just dropped the rulebook covering fees, capital and governance.
The Louisiana Department of Insurance filed a Notice of Intent on May 20, 2026 to promulgate Regulation 139, the framework governing captive insurance companies and risk retention groups domiciled in the state. The regulation implements Act 313 of the 2025 Regular Session, known as the CHOICES Law – short for Creating Holistic Options in Coverage for Enterprise and Self-Insurance, codified at R.S. 22:550.1 through 550.32.
The Act gives the Commissioner of Insurance authority over the formation, licensing, regulation and taxation of domestic captives and risk retention groups. Regulation 139 is the operating manual.
For insurers, brokers and risk managers tracking domicile competition, the details matter.
The process starts with a pre-application meeting at the Department's Office of Licensing, where regulators size up the applicant's organization, insurance needs, business plan and ownership structure before a formal Captive Application for Admission is filed. Four captive structures are recognized: pure captives, association captives, risk retention groups, and affiliated reinsurance companies.
Governance rules are flexible. Captives can be incorporated by fewer than five natural persons with the Commissioner's approval, and boards can run with fewer than five members on the same basis. Risk retention groups must keep corporate governance standards substantially similar to those adopted by the National Association of Insurance Commissioners and comply with the NAIC Model Risk Retention Act.
Capital can be held in cash, cash equivalents, bonds, marketable securities, surplus debentures, letters of credit, an approved trust pledged to the Commissioner, US government obligations, or any other form approved by the Commissioner. The Commissioner can also tailor capital and surplus requirements based on the type, volume and nature of business written.
On single-risk exposure, the Commissioner may allow a captive or risk retention group to take on loss exposure greater or less than ten percent of capital and surplus, with reinsured portions deducted from the calculation.
Reporting is heavy. Captives must file an annual statement of financial condition by March 1, verified by the oath of at least two executive officers, and an audited GAAP financial statement by June 30. The audit package covers the CPA's report, balance sheet, income statement, cash flow statement, statement of changes in capital and surplus, notes, internal controls report, accountant's letter and an actuarial analysis application. An annual actuarial certification of loss and loss expense reserves is also required.
CPAs must be in good standing with the American Institute of Certified Public Accountants and licensed in at least one state. Actuaries must be qualified under the NAIC Property and Casualty Annual Statement Instructions with at least three years of experience handling property and casualty reserves. Captive managers need the Commissioner's authorization before they can manage anything.
Captives that wind down can apply for a certificate of dormancy, keeping their licence and legal existence alive, filing annual statements and paying fees, but writing no new business. Resuming operations requires a fresh business plan and the Commissioner's approval.
Enforcement teeth are sharp. Under La. R.S. 22:18, the Commissioner can fine, refuse, suspend or revoke a certificate of authority, and can issue cease and desist orders for any violation of Title 22.
The cost of entry is set by Act 313: $500 for the initial application and $6,000 for the actuarial review, per company. The Department's fiscal statement notes the framework may encourage the formation and redomestication of captive insurers, with potential economic benefit for the state.
Public comments close at 4:30 p.m. on June 10, 2026, with Jennifer Land, Staff Attorney at the Louisiana Department of Insurance, listed as the contact. The regulation takes effect upon final publication in the Louisiana Register.
