HARTFORD, Conn. (AP) — Hartford is trying to recapture its status as the nation’s insurance capital by drawing in a specialized insurance business that is finding a home elsewhere.
Since the 18th century, Hartford — home to Aetna Inc., Cigna, The Hartford, Travelers Cos. and others — has been synonymous with insurance. Even Hartford’s skyline is dominated by the 34-story granite Travelers tower built in 1919.
But as the industry fragmented and companies merged and sold units and shifted headquarters to other states, Connecticut’s luster as the insurance leader dimmed.
Now Gov. Dannel P. Malloy is looking for something new in one of the state’s oldest industries. His budget proposes to establish a division in the Insurance Department to regulate companies that specialize in captive insurance, a form of self-insurance.
Captive insurance companies are subsidiaries set up by a large company to insure the company’s own risks. By taking on risk, companies can save money that would otherwise go to the bottom line of insurance companies.
The legislature established the division in the Insurance Department and Malloy now wants it staffed. He and lawmakers also hope that developing a captive insurance industry — following the lead of many other states — will establish much-needed jobs. Connecticut already is home to thousands of insurance workers who can quickly fill new industry jobs, say state officials and industry representatives.
To help lure new companies, Malloy wants the legislature to establish a $7,500 tax credit for a captive insurer’s first year in business and modify certain requirements.
It’s part of his plan, he said in a speech to the General Assembly this month, to make Connecticut “home to a reinvigorated insurance industry.”
Agency staff would rise from 141 to 159, up 13 percent. That’s still far less than the staff level of about 180 in 2000, Insurance Commissioner Thomas Leonardi said.
Leonardi and Sen. Joseph Crisco, co-chairman of the Insurance and Real Estate Committee, say Connecticut needs to attract captive insurance companies.
“We still believe we’re the No. 1 insurance state, and we want to continue,” Crisco said. “What can we do more to improve our position?”
Marketing efforts to bring captive insurance companies to Connecticut will be drawn up by the Insurance Department and state Department of Economic and Community Development, Leonardi said.