CAPTIVE INSURANCE IN 2026
R&C: How do you see captive utilisation changing in 2026 and beyond, both by type and by level of usage? What factors make captives an attractive option for organisations?
Tait: After several years of hard market, followed by a softening market, I see companies continuing to appreciate that having a captive is an important part of a risk management financing programme, regardless of the state of the market. I see this appreciation continuing and expanding as captives tools continue to address some of the emerging, less insurable issues that management teams appreciate need to be addressed. This means companies can be less reliant on the traditional insurance markets for some of their day to day needs, and look to them to provide that excess capacity the captives and their owners do not want to keep on their balance sheets. This change also lets risk managers take a more intentional look at how they design and manage their underlying risk programmes.
Campbell: More sophisticated companies started deploying their captives to a much greater extent some 10-15 years ago, in large part as a reaction to the hard market of the early to mid-2000s. With well managed risks and a deeper understanding of key exposures, particularly supply chain, there was no downside to taking higher retentions. But there was upside too: by using the captive strategically as an aggregator of largely uncorrelated risks and laying off unwanted volatility to the nascent alternative risk transfer (ART) market, the economic value of that diversification could be recaptured from the traditional market. This thinking has opened doors to optimised, captive-led risk financing programmes. 2026 will see this continuing.
Apr-Jun 2026 Issue
Sigma7
SRS Europe