Head of state’s captive staff gains national accolades

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Steve Kinion got his start in the captive field in his native Oklahoma, where he helped American Indian tribes form captive insurers to provide better health care for members.
Steve Kinion got his start in the captive field in his native Oklahoma, where he helped American Indian tribes form captive insurers to provide better health care for members.

It is evident that Steve Kinion is passionate about what he does. It doesn’t hurt that accolades and success stories followin his footsteps.

As director of Delaware’s Bureau of Captive and Financial Insurance Products, he and  his superiors have facilitated licensure of more than 1,000 captive insurance companies seeking domicile in Delaware.

Ranked No. 3 out of the 50 most influential people in the captive insurance world by Captive Review magazine last year, Kinion is a man who delivers.

The leap is an impressive one – he moved up the ranks from number 37 in 2013. The accomplishment, he said, was his finest moment in the captive industry. In publicizing the ranking, Captive Review magazine reports: “Kinion has increased his level of influence by making passionate and well-considered interventions around topical regulatory issues.”

The press recognition, Kinion is quick to say, is a tribute to both the captive program and his team. “Though I was the honoree, this award is actually reflective of the hard work of Delaware’s captive insurance staff.

Additionally, without Insurance Commissioner Karen Weldin Stewart giving me the opportunity to succeed by supporting her vision to make Delaware a first-tier captive insurance domicile, I would not have been recognized.  I look at it as a plural award.”

Kinion began his foray into the insurance industry in his home state of Oklahoma where his initial exposure to captive insurance occurred while working at the Oklahoma Department of Insurance.  The exposure was helping American Indian tribes in Oklahoma form captive insurers in order to provide better health services for their members.  “In these cases it was a decision by tribal leaders to consider captive insurance as a solution to their dissatisfaction with the Indian Health Service.”

Today Kinion resides in Illinois and commutes back and forth to Delaware to perform his duties.

Here in Delaware, Kinion serves as the bureau’s chief regulator, ensuring solvency and compliance with the state’s captive laws. Although he now splits his time between Illinois and Delaware, he is committed to growing Delaware’s captive insurance business and reputation.

For example, when Commissioner Stewart appointed Kinion as the captive bureau director in 2009, Illinois was the leading state for the formation of risk purchasing groups.  Today, Delaware is the leading state and Illinois is second.  “One of the reasons Commissioner Stewart asked me to join her team is because I have seen both the successes and failures of regulating insurance in other states and I bring the best practices to Delaware.”

While his dual state status keeps him on his toes, Kinion also balances a military career as a lieutenant colonel in the U.S. Army Reserve.  Kinion said the three careers complement each other and sometimes overlap. Realizing Kinion’s background in insurance, the Army has sought consultation on related topics.  “One of my military assignments was working on the War Risk Insurance Program.”  The military relies on private companies to transport military cargo into combat zones.  Because many private insurance policies exclude coverage in combat zones, under the War Risk Insurance Program the federal government becomes the insurer for what is excluded.

Kinion was on the front end of the upswing regarding Delaware’s unprecedented growth in the captive insurance market. In addition to attracting U.S. business, Kinion said that Commissioner Stewart’s strategic plan   for the captive bureau is to actively pursue overseas opportunities.

“We are reaching out beyond the shores of America to attract international insurance business to Delaware,” he said.  “My father was a career Army soldier and I spent my early childhood in Germany.  Because of this experience, I speak fluent German today and can communicate with European insurance officials in their native language.”

In addition to attracting European companies that may have U.S. operations, many Latin American companies don’t have captive laws within their borders. “We are also reaching out to Latin American companies,” said Kinion.  One of the reasons Delaware is an attractive captive insurance domicile is because it allows captive insurers to use (IFRS), the international accounting standard.

“Approximately 120 nations and reporting jurisdictions permit or require IFRS for domestic listed companies. When a foreign, i.e. non-U.S., firm creates a captive insurer in Delaware, it can use IFRS as its accounting standard. This allows the firm to accomplish two very important tasks.  First, it can present the captive’s financial statements using the same accounting standard as the home country parent and affiliated companies. Second, it allows a captive’s parent to use a single company-wide accounting language. This avoids the expense of converting the Delaware domiciled captive’s financial statements from a U.S. accounting standard to IFRS.”

While Kinion’s livelihood has him facilitating captive insurance plans for international and domestic businesses, and attending numerous conferences a year on captives, he values time spent closer to home. As the father of two daughters and a son, , Kinion serves as the leader of his 9-year-old son’s Cub Scout troop.  “I have 12 9- and 10-year-old  boys in my troop.  One of my greatest challenges is focusing the combined energy of this many boys onto one topic – it’s not always easy.”

It is from family too, that he draws his inspiration.  “I would say my father was my greatest inspiration. He came from a humble background in Oklahoma, and was a child during the Great Depression. For someone who really didn’t have many of the opportunities because of the times, he had a very successful military career.  Moreover, he did a good job providing for and raising a family.”

“I like what I do. It’s a lot of fun. I get tremendous enjoyment seeing where we started to where we are today.”  When asked to further reflect, he added, “When Commissioner Stewart appointed me in 2009, Delaware was a mere footnote on the world’s captive map.  Her charge was for me to build an internationally recognized captive insurance program.  In terms of licensed captive insurance companies, today Delaware ranks as the sixth largest captive insurance domicile in the world and the third largest in the U.S.  Though we have had significant success, there’s no time to rest on any laurels.  I have the energy and desire to make the First State the first place captive insurance domicile.”

 

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