Governor Ron DeSantis signed CS/CS/HB 883 on May 11, creating Florida’s first regulatory framework for protected cell captive insurance companies. The law takes effect July 1, 2026, giving the state’s Office of Insurance Regulation (OIR) six weeks to begin accepting license applications under the new structure. The bill passed both chambers unanimously: 110-0 in the House, 37-0 in the Senate.
A protected cell captive (PCC) is a single licensed insurer that houses multiple legally segregated cells. Each cell’s assets and liabilities are walled off from every other cell, so one participant’s adverse development cannot reach another’s surplus. The structure lets mid-market employers access captive economics (investment income on reserves, underwriting profit retention, loss-control incentives) without bearing the full fixed cost of a standalone license.
The key number: $100,000 in minimum unimpaired paid-in capital per cell. That is a fraction of the $250,000 required for a Florida standalone pure captive and well below the $250,000 to $500,000 typical in most domiciles. A late committee amendment restored the lower threshold after earlier drafts had raised it, signaling legislative intent to keep the entry point accessible.
Who It Affects
The clearest beneficiaries are self-insured employers in the $5 million to $25 million retained premium range: mid-size contractors, regional healthcare systems, hospitality groups, and logistics operators whose general liability, commercial auto, and professional liability retentions are large enough to justify formal risk financing but too small to amortize standalone captive overhead. The law excludes workers’ compensation, employer’s liability, life, health, personal auto, and personal residential property from PCC programs, concentrating the opportunity on GL, commercial auto, professional liability, and inland marine lines.
How This Changes Reserve Governance
Under a traditional self-insured retention, unpaid claim liability sits on the employer’s general balance sheet with no formal capital requirement. A PCC cell moves that liability into a regulated insurance entity with statutory accounting and a mandatory actuarial opinion.
The $100,000 capital floor creates a surplus cushion that many informal retentions lack. The cell must maintain capital above the statutory minimum after absorbing adverse development, forcing earlier intervention when case reserves strengthen beyond plan. Asset segregation means each cell’s funded status is transparent to its owner and to the regulator, unlike pooled structures where cross-subsidization can mask individual deterioration. And the annual actuarial opinion becomes a regulatory obligation, not a discretionary expense.
What This Means for Your Next Review
If your organization retains $2 million or more in GL, auto, or professional liability losses and has rejected a standalone captive on cost grounds, the July 1 effective date opens a new option. Ask your actuary to model a PCC cell alongside your current retention structure: what surplus target absorbs a 1-in-10-year adverse development scenario, and does the investment income and underwriting margin offset the cell’s operating costs?
Florida’s framework arrives as Vermont tightens its own cell captive rules under H.649, which added funding certification requirements for protected cells. Together, the two developments signal that regulators view cell structures as permanent vehicles with rising governance standards. The newly formed Florida Captive Insurance Association is targeting 200 captives in the state within five years, up from fewer than 10 today.