33-28-104. Minimum capital surplus -- letter of credit. (1) A captive insurance company may not be issued a license unless it possesses and maintains unimpaired paid-in capital and surplus of:
     (a) in the case of a pure captive insurance company, not less than $250,000;
     (b) in the case of an industrial insured captive insurance company, not less than $500,000;
     (c) in the case of an association captive insurance company, not less than $750,000;
     (d) in the case of a sponsored captive insurance company, not less than $1 million; or
     (e) in the case of a branch captive insurance company, not less than the applicable amount of capital and surplus required in subsections (1)(a) through (1)(d), as determined based upon the organizational form of the foreign captive insurance company.
     (2) The commissioner may require additional capital and surplus based upon the type, volume, and nature of insurance business transacted.
     (3) Capital and surplus may be in the form of cash, cash equivalent, or an irrevocable letter of credit issued by a bank chartered by the state of Montana or a member bank of the federal reserve system and approved by the commissioner.
     (4) Despite the requirements of subsection (1), a captive insurance company organized as a reciprocal insurer under this chapter may not be issued a license unless it possesses and maintains unimpaired paid-in capital and surplus of $1 million.
     (5) In the case of a branch captive insurance company, security in an amount not less than the minimum capital and surplus required in this section must be jointly held by the commissioner and the branch captive insurance company in a bank of the federal reserve system approved by the commissioner.

     History: En. Sec. 4, Ch. 298, L. 2001; amd. Sec. 10, Ch. 383, L. 2003.