Captives motoring ahead claims GILC report
Captive insurance formations are accelerating globally as corporates seek greater control, stability and resilience in response to prolonged hard market conditions, according to a new report from Global Insurance Law Connect (GILC).
Drawing on insights from member firms across 20 jurisdictions, the 2026 GILC Captives Report identifies sustained premium increases, constrained underwriting capacity and emerging risk complexity as primary drivers behind a marked expansion in captive utilisation.
Once predominantly used by large multinationals, captives are now increasingly being established by mid-market corporates, public sector entities and organisations in developing economies, the report said.
The report finds that the hardening commercial insurance market since 2018 has been the single most significant catalyst for captive growth.
Across Europe - including Germany, Spain, Italy and the UK - member firms report sustained increases in formation activity. Spain alone estimates approximately 50% growth in captive demand over the past five years as businesses respond to rising premiums and reduced coverage availability.
Similar trends are evident in Australia, New Zealand, the United States and Latin America. In particular, corporates are utilising captives to secure capacity in lines such as cyber, environmental liability and catastrophe-exposed property, where pricing volatility and underwriting restrictions remain acute.
Gillian Davidson, chair of GILC, commented: “We are witnessing a structural shift in corporate risk financing. Captives are no longer viewed as niche vehicles for only the largest multinationals; they are increasingly central to enterprise risk strategy. The pace of adoption among mid-market and public sector organisations reflects sustained pressure in the commercial market and a clear desire for greater financial certainty.”
Alongside demand-side pressure, the report highlights a wave of regulatory reform reshaping domicile competitiveness.
Established captive centres including Luxembourg, Switzerland, Malta and key US states continue to refine their regimes, while jurisdictions such as France, the UK, Italy and Greece have introduced or are developing reforms designed to attract new formations and encourage re-domiciliation.
France’s 2023 reforms have already produced measurable results, with domestic captive numbers increasing from fewer than 10 to 23 within two years.
In the UK, a government-backed captive insurance regime expected by summer 2027 is anticipated to introduce proportionate capital requirements, streamlined authorisation processes and Protected Cell Company structures. Market participants view the framework as a significant development in the UK’s risk financing architecture.
Caroline Wagstaff, Chief Executive of the London Market Group (LMG) and an advocate for a UK captives regime, said: “This report makes clear that captives are no longer peripheral tools for only the largest multinationals, they are rapidly becoming central to modern risk‑financing strategy. The UK’s forthcoming captive regime represents a major step forward, ensuring we retain and attract corporate capital that might otherwise move offshore. By introducing a proportionate, competitive and internationally aligned framework, the UK is positioning itself as a leading domicile for the next generation of captive growth.”
In jurisdictions without domestic captive legislation – including Brazil, Chile, India, Argentina and Mexico – corporates continue to rely on established offshore domiciles such as Bermuda, the Cayman Islands, Luxembourg and certain US states.
Beyond formation growth, the report identifies a widening strategic application of captives across all markets.
Mid-sized corporates in both Europe and the United States are increasingly using captives to stabilise long-term insurance costs and strengthen balance sheet resilience. Public sector adoption is also expanding, with Norway utilising captive structures to manage municipal and national infrastructure exposures, including property portfolios and energy networks.
Organisations are also extending captive programmes beyond traditional property and casualty lines. Captives are being deployed to test emerging risks, manage climate-related exposures, support ESG-aligned strategies and enhance long-term capital planning.
While regulatory frameworks vary by jurisdiction, the report concludes that proportional oversight, competitive positioning among domiciles and expanding corporate engagement point to sustained global momentum in the captive sector.
Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
