State of South Dakota
LEGISLATIVE ASSEMBLY, 2012
SENATE BILL NO. 144
Introduced by: Senators Lederman, Frerichs, Maher, Nelson (Tom), and Rampelberg and
Representatives Miller, Hansen (Jon), Kloucek, and Rozum
FOR AN ACT ENTITLED, An Act to amend provisions regarding captive insurance
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
Section 1. That chapter 58-46 be amended by adding thereto a NEW SECTION to read as
Notwithstanding §§ 58-46-23 and 58-46-23.1, pure captive insurance companies may cede
or assume risk from related or unaffiliated captive insurance companies by forming reinsurance
risk pools for the purpose of reinsurance upon approval of the director.
Section 2. That chapter 58-46 be amended by adding thereto a NEW SECTION to read as
The director may approve any application for the formation of or participation in a
reinsurance risk pool by pure captive insurance companies as long as the risk pool is
domesticated in South Dakota, and complies with the regulatory standards for a pure captive
insurance company under chapter 58-46.
Section 3. That chapter 58-46 be amended by adding thereto a NEW SECTION to read as
Any reinsurance risk pool formed pursuant to this Act shall be treated as a pure captive
insurance company for all regulatory and tax purposes.
Section 4. That chapter 58-46 be amended by adding thereto a NEW SECTION to read as
The director may promulgate rules, in accordance with the existing department rules
regulating pure captive insurance companies pursuant to chapter 1-26 regarding the
administration of reinsurance risk pools.