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September 09, 2005 at 08:00 PM
Concerns about California premium taxes prompted Pacific Life Insurance Company to redomesticate its operations to Nebraska from California effective Sept. 1, 2005.[@@]
Nebraska Insurance Director L. Tim Wagner approved the move Aug. 19.
The premium tax rate is 1% in Nebraska. That compares with a rate of 2.35% in California, says Tennyson Oyler, a Pacific Life spokesman.
When Pacific Life was domesticated in California, it had to pay the higher of each state’s local tax rate or California’s 2.35% rate in each of the 50 jurisdictions in which it was authorized to conduct business, Oyler says.
The requirement that an insurer pay the higher tax is called a “retaliatory tax.”
Now, Pacific Life will pay a maximum rate of 1%, Oyler says.
