Effective May 25, 2023, the Delaware legislature passed a law amending 18 Delaware Code Section 511, which establishes the minimum amounts of capital and surplus required for a carrier to transact insurance within Delaware. All licensed insurers in Delaware, including stock, mutuals, or reciprocals, must now possess minimum capital of $650,000 as well as a minimum free surplus of $350,000 in order to transact any line of insurance. Previously, these minimum amounts of capital and surplus varied among carrier types and/or lines of authority.
For Delaware domestic insurers which obtained a valid certificate of authority prior to January 1, 2024, they may continue to be authorized under the prior capital and surplus minimums for a period of 5 years (until January 1, 2029). This exception does not apply to new applicants, or those Delaware domestic which seek to expand their authority in the state.
The Delaware Department of Insurance has issued Domestic/Foreign Insurers Bulletin 140, which provides further information on these changes.
For any questions related to the new capital and surplus requirements in Delaware, or for any of your carrier licensing and compliance needs, please contact Westmont Associates!