A G E N D A. Meeting of the Executive Committee Wednesday, July 18, :00 am (Hawaii Standard Time) 1:00 pm (Pacific Daylight Time)

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1 A G E N D A Meeting of the Executive Committee Wednesday, July 18, :00 am (Hawaii Standard Time) 1:00 pm (Pacific Daylight Time) Offices of KMH LLP 1003 Bishop Street, Suite 2400 Honolulu, HI Call in Number Conference Code A. Call to Order/Determination of Quorum B. Approval of the May 9, 2012 Executive Committee meeting minutes draft C. Committee Reports Legislative Membership Finance Marketing Website Forum Education Japan Marketing D. Other Business Examination process Debrief from meeting with the State of Hawaii Insurance Division RIMS 2013 room block NRRA HCIC Vision and Mission Statements E. Adjournment

Minutes Hawaii Captive Insurance Council Corporation Meeting of the Executive Committee May 9, 2012 Honolulu, HI Attendees: Dave Kahaulelio, Chair Matt Takamine, President Fay Okamoto, Vice Chair JP

2 Minutes Hawaii Captive Insurance Council Corporation Meeting of the Executive Committee May 9, 2012 Honolulu, HI Attendees: Dave Kahaulelio, Chair Matt Takamine, President Fay Okamoto, Vice Chair JP Schmidt, Vice President Christina Kamaka, Treasurer Gerald Yoshida, Legislative Committee - (via Teleconference) Excused: Jerelyn Brown, Secretary Dustin Verity, Forum 2012 Chris Mertes, Vice President Invited Guests: Jill Miura, Education Committee Danel Licari, Membership Committee Colin Teraoka, Japan Marketing Committee Ward Ching, Website Committee -Teleconference Mark Hironaga, Assistant Secretary Ed Haik, Membership Committee Paul Wagner, Assistant Treasurer Scot Sterenberg, Marketing Committee Kari Nettel, Project Coordinator A. B. C. Agenda Item Call to order Minutes 3/14/12 Committee Reports Legislative Committee Comments/Follow Up Meeting was called to order by Matt Takamine, President at 10:00 am. Approved as amended. Gerald Yoshida reported that Senate Bill #2765 was passed by the Conference Committee with changes and passed by both houses. One of the changes made was the deletion of the controlled unaffiliated business language in the bill. It will now be reviewed by the Department Heads and go on to the Governor, where it can be signed, vetoed or allowed to become law without signature. If it becomes law, it will

3 be effective as of July 1, Regarding credit for reinsurance, the Insurance Division is taking a narrower view as prescribed under Article 4A for RRG s. They are concerned about there accreditation by the NAIC. It was mentioned that Vermont allows reinsurance credit other than what is prescribed under Article 4A at their Insurance Commissioner s discretion. Also, Lexington is not an approved reinsurer in Hawaii. Matt Takamine will work on setting up the quarterly meeting with the Insurance Division at which these can be discussed. Fay Okamoto presented her report on the new pure captive State Examination requirements. Auditor workpapers will be required to be in electronic format, but they will be flexible on captive manager records. The State stressed receiving the requested items by their designated due dates. She mentioned that although the State seemed to be verbally receptive of some suggested changes to Attachment 3, nothing has been confirmed. Both Dave Kahaulelio and Ward Ching voiced their concern over some of the Attachment 3 requested information since they were not needed for the examination. JP Schmidt suggested having a meeting with the Insurance Commissioner to discuss the HCIC s concerns and how the changes are making Hawaii a harder place to do business and a less attractive domicile. Ward Ching mentioned that he would be in town from May 21 to the 24 th if a meeting can be established. Paul Wagner could also be available. JP Schmidt reported that he spoke with Karl Bonham of UHERO about them doing an economic analysis for the HCIC. Mr. Bonham will get back to him. No price was discussed for the project. Paul Brewbaker did not respond to his request. He will try again. Membership Committee Finance Committee Membership Report Ed Haik reported that 50 captive owners and 30 service providers have signed up to date. He requested everyone s help in getting additional members so we can exceed last year s 85 members. The IPAD was won by Jamie Jackson of Western States Insurance Company. The Kahala hotel is the only outstanding 2012 hotel benefit renewal. Their contract should be forthcoming. Christina Kamaka reported on the financial results for the nine month period ending March 31, She also reported that the GET returns for the tax years ended December 31, 2002 through June 30, 2011 were filed on

4 April 5, There has been no response to date. Comment [MDRT1]: Shouldn t this be 2012? Christina Kamaka then discussed the HCIC 2012/2013 budget. WRIN budget The Insurance Division may pick up some of the cost. Dave Kahaulelio suggested having WRIN involved at RIMS with a Hawaii focus. JP Schmidt will discuss RIMS with WRIN and the Insurance Division regarding sponsorship. The Executive Committee agreed to put a $7,500 budget as a placeholder. Christina Kamaka also mentioned that there is no amount budgeted for tax services since Paul Wagner secured Saslow Lufkin & Buggy, a CPA firm specializing in captives, to do the job pro-bono. Matt Takamine mentioned the need to increase the legislative expense budget to accommodate legislation tracking. He will look further into it. A revised budget will be distributed for the next Board meeting. Marketing Committee Website Committee Forum Committee/Education Committee The Committee discussed the Marketing Committee report submitted by Scot Sterenberg. Mark Hironaga mentioned that Scot had a conversation with George Sumner and that he will be coming up with a list of approximately 40 captive owners names he would like to use on a regular basis and will be seeking assistance is getting their authorization. Dave Kahaulelio said that we should continue with the Logos project. Ward Ching mentioned that he has already committed $5,000 to Lowe Studio Inc. for the website redesign project. He also mentioned that Safeway will be an ad space sponsor on the website. Matt Takamine will discuss the process and contract with him. Jill Miura reported that Craig Watanabe is the current President of the HSCPA and is working on setting up brown bag lunch/short HSCPA/HCIC sessions which would be free of charge. Forum She reported that 2 gold and 9 silver sponsors have been secured for the 2012 Forum, for a total of $24,000 to date. She will be contacting the State of Hawaii and FHB regarding their sponsorship. It was suggested that Perr Knight and Milliman also be contacted. She mentioned that Brian Clay has been contacted as a possible Keynote speaker but the budget is $5,000 and he has requested $15,000. Ed Haik mentioned that Brian s

5 brother is a former BOH employee and he will contact him regarding the fee. Jill Miura mentioned that an FBI agent, who could speak on white collar crime, is also being considered and would be at no charge. Colin Teraoka mentioned that he knows a person who could speak on how to do business in Japan for American companies. Jill Miura stated that the Forum sessions will be finalized at the next meeting and that Education/Forum Committee members will be assigned to track attendance at each session. Japan Marketing D. Adjournment 2012 HCIC Captive Insurance Seminar in Tokyo - Colin Teraoka reported on the estimated room rental cost at the Waseda Nihonbashi Campus, which is in a central location and known by businessmen. He also suggested that the program be changed from the historical captive basics presentations and proposed having an industry specific program such as the marine/cargo industry. He mentioned that the HCIC would not need to be a sponsor. Ed Haik suggested having the program right after the State s oneon- onee meetings so that the seminar can be mentioned along the way to those prospects. Matt Takamine stated that we should move forward with the due diligence. The meeting was adjourned at 11:44 am.

6 Finance Committee Report Date: July 13, 2012 Submitted by: Christina Kamaka Committee Members: Christina Kamaka, Treasurer Paul Wagner, Assistant Treasurer A. HCIC Financial Statements as of June 30, 2012 attached Financial Position As of June 30, 2012 and 2011, HCIC held assets of $426,883 and $362,903, respectively. Substantially all of the HCIC s assets are held in a checking account and two certificates of deposit with Bank of Hawaii. As of June 30, 2012, $30,600 of liabilities relate to the registration and sponsorship received for the October 2012 forum to be held at the Hilton Hawaiian Village. Financial Results Dues Membership dues are recognized throughout the calendar year on a straight line basis. Forum Net forum revenue from the October 2011 forum held at the Ritz Carlton Kapalua was $101,241. B. HCIC General Excise Tax Status As previously reported, all of the tax returns were filed. We have not received a response from the Department of Taxation. C. Budget for July 1, 2012 to June 30, 2013 The approved budget for the period July 1, 2012 to June 30, 2013 is posted on the Directors only section of the website.

7 Hawaii Captive Insurance Council Balance Sheet As of June 30, 2012 and June 30, 2011 June 30, 2012 June 30, 2011 ASSETS BOH Checking 215, ,121 Time Certificate of Deposit 200, , , ,121 Accounts Receivable Deposits - Forum 3,500 30,078 Prepaid expense - Forum 6,166 1,959 Prepaid expense - Other 980 2,660 TOTAL ASSETS 426, ,903 LIABILITIES & EQUITY Accounts Payable 5,085 1,942 Accrued Expenses 3,849 2,284 Dues Recd in Adv - Owners 8,450 8,363 Dues Recd in Adv - Service Prov 12,400 13,600 Forum Early Bird Member Received Forum Sponsorhips Received 30,000 35,000 Total Liabilities 60,384 61,189 Equity Opening Bal Equity 7,519 7,519 Retained Earnings 294, ,635 Net Income 64,785 29,560 Total Equity 366, ,714 TOTAL LIABILITIES & EQUITY 426, ,903

8 Hawaii Captive Insurance Council Income Statement For the Year Ended June 30, 2012 Year Ended Annual Over/ June 30, Budget (Under) 2012 FY 2012 Budget Income Forum Sponsors 82,500 82,500 - Registration 139, ,730 17,320 Dues 44,913 44, Interest Total Income 266, ,930 17,711 Expenses Forum 120, ,730 (1,421) HCIC Coordinator Services 56,146 55,000 1,146 Accounting Services 3,849 5,700 (1,851) Tax Services - 1,200 (1,200) Insurance 1,940 2,000 (60) Trade Shows & Advertising 7,380 2,350 5,030 Miscellaneous 1,360 1,500 (140) Membership 1,441 1,577 (136) Utilities Promotions (newsletter & pubs) 7,814 4,000 3,814 Website 231 1,200 (969) Meetings Banking Fees (4) Postage (70) Legislative Expenses ,500 (11,014) Seminars - 1,000 (1,000) Total Expenses 201, ,607 (7,751) Net Income (Loss) 64,785 39,323 25,462 -

9 Marketing Committee Report to Executive Committee July 18, 2012 Offices of KMH LLP 1003 Bishop Street, Suite 2400 Honolulu, HI Committee Members: Scot Sterenberg, Chair Jerelyn Brown Ward Ching Kevin Higa Chris Mertes Paul Shimomoto Alice West A. We are finalizing the Logo usage form and expect to publish in August and gather approvals from captive owners shortly thereafter. B. The State of Hawaii missed the deadline to exhibit at the VT conference, however George Sumner will be in attendance and it is anticipated that the Captive Branch will exhibit in VT in C. Newsletter is planned for August Please submit any relevant articles to Scot or Kari by by the end of July. We plan on making newsletter available before the Forum.

10 Legislative Committee Report to Executive Committee Date: July 18, 2012 Submitted by: Jerry Yoshida, Chair A Captive Legislation: SB2765: Senate Bill 2765 (Captive Insurance Bill) was signed into law by Governor Abercrombie on July 10, 2012 as Act 253 (the Act ). The Act became effective July 1, A copy of the Act is attached. B. Administrative Rules: The Committee intends to re-convene discussions with Deputy Commissioner, George Sumner regarding amendments or additions to the administrative rules relating to captive insurance companies. In light of concerns over the effects of the Non-admitted Reinsurance Reform Act provisions of the Dodd-Frank Wall Street Reform Act, the Insurance Division may be considering revising the premium tax, fees and assessments imposed or to be imposed upon Hawaii-domiciled captives.

11 Membership Committee Report to Executive Committee Date: 7/18/12 Submitted by: Danel Licari/Ed Haik (Co-Chairs) List Committee Members: Danel Licari, Ed Haik A Membership Renewals 1) Total of 81 members signed up to date. One more service provider signed up since May captive owners (50 X $325 = $16,250) - 31 service providers (31 X $800 = $24,800) - Total revenues from service provider and owner members to date = $41,050. B Forum 1) The membership committee is working with Kari to have a presence at the upcoming forum to promote membership and answer any questions or concerns from existing or potential members. C Hotel Benefit Renewals 1) The renewal with the Kahala hotel has been completed and the website has been updated.

12 Forum/Education Committee Report to the Executive Committee Date: July 17, 2012 Submitted by: Jill Miura Education Committee Members: Christina Kamaka, Dustin Verity, Craig Watanabe, Mark Hironaga, Fay Okamoto, Wanda Jong, Jill Miura Forum Committee Members: Dustin Verity, Chair, Christina Kamaka, Lynn Saito, Jason Palmer, Craig Watanabe, Jamie Asato, Fay Okamoto, Helen Chang A. Forum 2012 Update October 22-24, 2011 at The Hilton Hawaiian Village, Oahu Sponsorships - 4 gold; 14 silver sponsors $40,000 Sessions - Sessions have been finalized - Shorter session times, various sessions offered twice Registration - Online registration and registration form are up on the website - The electronic brochure will be sent out shortly - 6 registrations to date Keynote speaker/entertainment - Keynote speaker confirmed as Bryan Clay - Welcome reception entertainment Paul Shimomoto B. Forum 2013 Update Received proposals from: - The Fairmont Orchid (alternative dates) - Waikoloa Beach Marriott - Hilton Waikoloa (alternative dates) - Hapuna Prince (alternative dates) Site visits are scheduled for July 24 th C. Other Educational Events Brown bags, webinars - Brown bag - end of August - Webinar mid September - Topics and dates will be finalized at next week s meeting 7/26/12

13 Hawaii Captive Insurance Council Our Mission: Guided by the Aloha spirit, the Hawaii Captive Insurance Council unifies and supports captive owners, regulators, legislators and captive service providers. The Hawaii Captive Insurance Council advocates on issues and initiatives, educates on current and future issues and communicates this information to its members and prospective members to maintain Hawaii as a world-class captive domicile. Our Vision: The Hawaii Captive Insurance Council supports Hawaii as a world-class captive domicile. We provide meaningful benefits to our members. Through our efforts, Hawaii is a leading captive domicile of the highest quality, known for its reliable regulatory approach and captive-business friendly environment. Our membership is actively involved and engaged in Hawaii Captive Insurance Council s activities - where business and government work hand-in-hand towards a common goal with unity, shared involvement and responsibility, while surrounded by the natural beauty of Hawaii.

A G E N D A. Meeting of the Executive Committee Wednesday, October 14, :00 am (Hawaii Time) 1:00 pm (Pacific Time)

A G E N D A. Meeting of the Executive Committee Wednesday, October 14, :00 am (Hawaii Time) 1:00 pm (Pacific Time) P.O. Box 2815 Honolulu, Hawaii 96803 A. Call to Order/Determination of Quorum A G E N D A Meeting of the Executive Committee Wednesday, October 14, 2015 10:00 am (Hawaii Time) 1:00 pm (Pacific Time) Offices