Louisiana is charging into the captive insurance arena with a sweeping new law that clears the runway for businesses to set up in-state captives fast.
Signed into law as Act 313, the “Creating Holistic Options in Coverage for Enterprise and Self-Insurance Law” - or CHOICES Law - drastically rewrites how the state handles captive insurance. The overhaul introduces tiered licensing, carves out premium tax limits, and hands broad discretion to regulators, giving brokers and risk managers a streamlined new playbook for advising clients on alternative risk solutions.
“This is about building a captive domicile that is competitive, attractive and business-friendly,” said state Rep. Bubba Chaney, a key backer. “It’s about giving Louisiana businesses more tools to manage their risk in-state.”
The law sets capital requirements as low as $250,000 for pure captives, increases flexibility around governance, and introduces a dormancy path for inactive captives. Risk retention groups and association captives get formal recognition, while new entrants can redomesticate under streamlined procedures.
Also notable: Captives are now exempt from Louisiana’s insurance guaranty fund contributions - a move likely to please large self-insured employers and risk-savvy groups looking for cost-efficient alternatives to the traditional market.
The state’s insurance commissioner now holds expanded authority to greenlight captives, set capital thresholds, and approve investments, reinsurance arrangements, and coverage expansions. Captives writing nontraditional lines or excess workers' comp will find fewer roadblocks — provided they meet new governance and solvency standards.
Premium tax rates are tiered and capped at $200,000 annually, with a minimum of $7,500 - a structure that favors both large enterprises and startups testing the captive waters.
“This law puts Louisiana on the radar for businesses looking to take control of their risk,” said a regulatory consultant familiar with the bill. “It gives captives room to move without tying them up in bureaucracy.”
The CHOICES Law is in effect now, and stakeholders say it could shift the competitive balance among US domiciles.
