Costco Wholesale Corp. unit NW Re Ltd. has paid $2.4 million in unpaid premium taxes and $1.2 million in fines, tax penalties and interest in a settlement with Washington Insurance Commissioner Mike Kreidler.
The captive insurer self-reported its unauthorized activity in December 2018, disclosing that it offered deductible reimbursement for Costco's liability and workers' compensation from 2000 until 2019 without authorization.
Kreidler announced a project in December 2018 to identify all captives doing business in the state. Fines and penalties increase every six months for captive insurers that fail to self report, starting July 1. Captives that do not self-report before June 30, 2020, will face the maximum fines and tax penalties.