The Cook Islands insurance legislation readily facilitates the formation and operation of captive insurance and reinsurance companies. The Off-shore Insurance Act controls the licensing of offshore insurance companies. Offshore insurance business is defined as any insurance business where each of the insured, the policy beneficiary and the owner of the policy are not domiciled nor ordinarily resident in the Cook Islands. Only an international company or a foreign company registered under the International Companies Act 1981-82 may be authorised to carry on offshore insurance business. A licensee is not permitted to transact any insurance business other than offshore insurance business and must use the services of a registered trustee company to conduct such business. An offshore insurance company is required to maintain a surplus of tangible assets over liabilities of US$100,000. A licensed insurer is exempt from any form of taxation and duty in the Cook Islands but must file annual audited accounts with the Cook Islands Monetary Board.
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