STAND. COM. REP. NO. 2107

Honolulu, Hawaii

RE: S.B. No. 2043

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred S.B. No. 2043 entitled:

"A BILL FOR AN ACT RELATING TO INSURANCE,"

begs leave to report as follows:

The purpose and intent of this measure is to authorize the Insurance Commissioner to issue a certificate of exemption from certain examination requirements to an applicant captive insurance company under certain conditions.

Your Committee received testimony in support of this measure from the Hawaii Captive Insurance Council, Brown & Brown, Alakai Global Inc., and Aon Insurance Managers (USA) Inc.

Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs.

Your Committee finds that the State is an attractive market for the global captive insurance industry due to its balanced approach to regulatory oversight. Your Committee further finds that taking a risk-based approach to statutory examinations and allowing compliant captive insurance companies to apply for an exemption certification from the five-year examination requirement can help reduce the compliance burden on companies, thereby enhancing the State's competitiveness in the industry.

Your Committee has amended this measure by:

(1) Inserting an effective date of January 1, 3000, to encourage further discussion; and

(2) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2043, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2043, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

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JARRETT KEOHOKALOLE, Chair