LANSING – State Representative Barb Byrum (D-Onondaga) today threw her support behind a plan that could bring hundreds of good-paying jobs to the Lansing area by proving for the formation, regulation and licensing of "captive" insurance companies. The plan passed the House unanimously today.
"My top priority as a State Representative is to create jobs for the hard-working residents of Ingham County, and this plan will allow us to diversify our economy and grow the insurance industry in Michigan," Byrum said. "The formation of captive insurance companies will allow Jackson National Life in Lansing to acquire companies and create hundreds of good-paying jobs. And that is just the tip of the iceberg."
A captive insurance company only provides insurance to its owners, who have direct control over the insurer's operations. Forming a captive insurance company enables businesses to save the cost of the premiums that commercial insurers charge for their acquisition expenses, overhead, and profit. Over half the states now have laws allowing and regulating captive insurance companies.
Vermont, which has the most captive insurance companies in the U.S., has seen those businesses increase from 230 captives in 1992 to over 560 by 2002. That growth has created over 1,500 jobs in the state.
"Michigan has the potential to be a leader in the insurance industry," Byrum said. "This plan will make our state more attractive to insurance companies looking to relocate. We already have a highly-skilled, hard-working pool of talent – by passing this plan, we are giving businesses an extra incentive to set up shop and grow the insurance industry in Michigan."