§ 7004. Required capital and surplus as regards policyholders. (a)
No pure captive insurance company or group captive insurance company
shall be issued a license unless it shall possess and thereafter
maintain unimpaired paid-in capital and surplus as regards policyholders
of:

(1) in the case of a pure captive insurance company incorporated as a
stock insurer, not less than two hundred fifty thousand dollars of total
surplus as regards policyholders, of which one hundred thousand dollars
shall represent paid-in capital;

(2) in the case of a pure captive insurance company incorporated as a
mutual insurer, not less than two hundred fifty thousand dollars of
total surplus as regards to policyholders;

(3) in the case of a group captive insurance company incorporated as a
stock insurer, not less than five hundred thousand dollars of total
surplus as regards policyholders, of which two hundred thousand dollars
shall represent paid-in capital; and

(4) in the case of a group captive insurance company incorporated as
a mutual insurer, not less than five hundred thousand dollars of total
surplus as regards policyholders.

(b) The minimum capital and surplus to policyholders required in
subsection (a) of this section shall be in the form of:

(1) cash;

(2) minimum capital or surplus to policyholders investments of the
type specified in paragraphs one and two of subsection (b) of section
one thousand four hundred two of this chapter; or

(3) an irrevocable letter of credit, in a form approved by the
superintendent, naming the superintendent as beneficiary for the
security of the captive insurance company's policyholders and issued by
a bank acceptable to the superintendent.

(c) The superintendent may prescribe additional capital and surplus
to policyholders based upon the type, volume and nature of insurance
business transacted. Any additional capital and surplus to
policyholders so required shall be in the form as set forth in
subsection (b) of this section.