§ 6032. Definitions
As used in this subchapter:
(1) “General account” means all assets and liabilities of the sponsored captive insurance
company not attributable to a protected cell.
(2) “Incorporated protected cell” means a protected cell that, subject to the approval
of the Commissioner, is formed as any type of entity permissible under Vermont law,
separate from the sponsored captive insurance company of which it is a part.
(3) “Participant” means an entity as defined in section 6036 of this title, and any affiliates thereof, that are insured by a sponsored captive insurance company,
where the losses of the participant are limited through a participant contract to
such participant’s pro rata share of the assets of one or more protected cells identified
in such participant contract.
(4) “Participant contract” means a contract by which a sponsored captive insurance company
insures the risks of a participant and limits the losses of each such participant
to its pro rata share of the assets of one or more protected cells identified in such
participant contract.
(5) “Protected cell” means a separate account established by a sponsored captive insurance
company formed or licensed under the provisions of this chapter, in which assets are
maintained for one or more participants in accordance with the terms of one or more
participant contracts to fund the liability of the sponsored captive insurance company
assumed on behalf of such participants as set forth in such participant contracts,
and shall include an “incorporated protected cell” as defined in this section.
(6) “Sponsor” means any entity that meets the requirements of section 6035 of this title and is approved by the Commissioner to provide all or part of the capital and surplus
required by applicable law and to organize and operate a sponsored captive insurance
company.
(7) “Sponsored captive insurance company” means any captive insurance company:
(A) in which the minimum capital and surplus required by applicable law is provided by
one or more sponsors;
(B) that is formed or licensed under the provisions of this chapter;
(C) that insures the risks only of its participants or, subject to Commissioner approval,
other parties unaffiliated with a participant as defined in subsection 6036(d) of this title, through separate participant contracts; and
(D) that funds its liability to each participant through one or more protected cells and
segregates the assets of each protected cell from the assets of other protected cells
and from the assets of the sponsored captive insurance company’s general account.
(8) “Controlled unaffiliated entity” means any person or entity:
(A) that is not in the corporate system of a participant and its affiliated companies;
(B) that has an existing contractual relationship with a participant or one of its affiliated
companies; and
(C) whose risks are managed by a participant, as applicable, in accordance with section 6019 of this title. (Added 2003, No. 55, § 9; amended 2011, No. 21, § 21; 2011, No. 78 (Adj. Sess.), § 35, eff. April 2, 2012; 2013, No. 103 (Adj. Sess.), § 7, eff. April 14, 2014; 2015, No. 20, § 3, eff. May 7, 2015; 2019, No. 3, § 6, eff. April 18, 2019; 2021, No. 139 (Adj. Sess.), § 15, eff. May 27, 2022; 2023, No. 110 (Adj. Sess.), § 1, eff. July 1, 2024.)