Cayman captives show resilience amid emerging risks
At the Cayman Captive Forum 2025, Kara Ebanks (pictured), head of the Insurance Supervision Division at the Cayman Islands Monetary Authority (CIMA), delivered her annual regulatory update.
Opening with a quiz to see how knowledgeable the audience was—an echo of the previous year—Ebanks used the exercise to frame the wider context of a sector navigating global disruption yet continuing to demonstrate exceptional resilience and growth.
Ebanks acknowledged that 2025 has been marked by persistent challenges across the global insurance landscape, from economic volatility to increasingly severe catastrophic events. Despite these pressures, Cayman’s insurance sector has continued its upward trajectory. The jurisdiction is celebrating its eighth consecutive year of new licence formations, now home to more than 700 international insurance entities. As of this week, 38 new entities have been licensed in 2025 alone, with numbers on track to exceed the 42 formations recorded in 2024. The overwhelming majority—37 of the 38—serve the international market, underscoring Cayman’s enduring global relevance.
Captives remain central to this growth story. Over half of new Class B formations this year have been Class B(i) captives. Of these new formations, 44% were group captives and 56% single-parent vehicles. The sector now contributes approximately $12.5 billion in annual premiums and $43 billion in total assets, representing more than a quarter of Cayman’s international insurance activity. In 2024, captives posted a 12% rise in annual premiums and a 7% increase in total assets, reflecting sustained confidence in the model.
Ebanks noted several trends shaping the sector’s expanding risk appetite. Captives are increasingly deployed to address protection gaps, manage hard-market conditions and support innovation in risk financing. Climate-related risks continue to drive programme expansion, with heightened emphasis on ESG strategies and business continuity planning—particularly key-person loss coverage. Parametric solutions are gaining traction, offering efficient mechanisms for securing coverage where traditional markets fall short.
Technological advancement, especially AI and data analytics, is another powerful force. While these tools offer significant operational benefits, they also contribute to rising cyber security and privacy risks. As a result, cyber coverage and business interruption protection are becoming more prominent within captive programmes. Ebanks highlighted strong growth in group captives: 44% of 2025’s formations fall into this category, up from 30% last year. Workers’ compensation, general liability and motor insurance continue to dominate new business lines, with captives increasingly incorporating motor liability and physical damage cover.
Cayman’s stature as a global reinsurance hub also remains robust. Accessibility to international reinsurance markets continues to fuel new formations, supported by affiliated entities designed to enhance market access. While North America remains the primary source of Cayman’s international insurance business, captives increasingly operate across multiple jurisdictions—reflecting the worldwide spread of emerging risks.
Turning to regulatory matters, Ebanks emphasised CIMA’s cooperative function, with only 35% of quiz participants identifying it correctly. The Authority has signed 70 bilateral and multilateral agreements, issued 57 requests for assistance to overseas regulators this year, and continues to engage actively with global standard-setting bodies. Ongoing regulatory initiatives include revisions to the Insurance Act, updates to actuarial rules and guidance, and enhancements to auditor approval policies. These efforts align with Cayman’s preparation for the Financial Action Task Force’s 2027 mutual evaluation.
In closing, Ebanks underscored the jurisdiction’s strong strategic growth, the resilience of its captive sector and its commitment to international best practice. She thanked industry partners and participants, urging them to share their “Cayman story” and continue championing the jurisdiction’s credibility and regulatory strength.
Did you get value from this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
