A bill amending Maine’s captive insurance law has been signed into law by Maine Governor John E. Baldacci.

Bill LD 1436, "An Act To Create Economic Development in the State by Modernizing the State's Captive Insurance Laws", is sponsored by Maine senator Justin Alford and was referred to the Senate Insurance and Financial Services Committee last month.

LD 1436, which Governor Baldacci officially signed into law on 9 June, includes provisions for the removal of captive premium tax and to enable the formation of sponsored and branch captives in the jurisdiction.

The bill also includes proposals to raise the minimum capitalization requirements for pure, association and industrial insured captives to $250,000, $750,000 and $500,000 respectively and those for sponsored captives and risk retention groups set at $500,000 and $1m respectively.

In addition, the bill expands the definition of association captives and lifts some restrictions on reinsuring workers compensation via a captive and on the investment of pure captive assets.