Captives continued to thrive in 2014, providing affirmation of their efficacy, flexibility, and stability. Certainty around Solvency II in Europe, changes in laws broadening rules for risk distribution, an explosion of small captives in the US, an increase in writing non-traditional lines of coverage, special purpose vehicles (SPVs), and new emerging markets, have all begun to transform the captive industry and demonstrate that captive growth is likely to endure.
As business owners become aware of the benefits of captive insurance programmes, the exploration of different possibilities in structures, domiciles, and coverage can create numerous opportunities. Once almost exclusive to Financial Times Stock Exchange (FTSE) 100 and Fortune 500 companies, captives now can provide benefits to organisations of all sizes, industries, and geographic orientation. Captives have been rapidly expanding among midsize companies, which are expected to be a robust growth sector for the captive industry in the future.
The World of Captives: Growth and Opportunities without Borders is based on an analysis of the more than 1,100 captives Marsh manages. Among our key findings:
More and more companies are finding that having a captive is a strategically important corporate asset, as it raises the visibility of risk management costs and serves as an effective control tool.