On January 1, 2019, the limitation on premium revenue under IRC 831(b) increased from $2.2 million to approximately $2.3 million. This occurred by operation of 26 U.S.C. 831(E), which provides that the $2.2 million limit shall be increased annually by a cost-of-living adjustment rounded up to the next lowest multiple of $50,000.
Most companies operating with an 831(b) captive insurance company do not need to worry about exceeding this statutory limitation. However, it is important to recognize the extent of this limitation when considering or developing a captive insurance program.