France opens door to captives

France’s Senate has passed a measure aimed at improving the risk coverage of French companies, by facilitating the creation of self-reinsurance structures.

With the support of the French Government the senators adopted two identical amendments aimed at allowing the establishment of a specific provision facilitating the creation of captive reinsurance companies by making them tax deductible.

The general rapporteur of the budget Jean-François Husson said that it was a question of “trying to find solutions for risks which are not currently covered, on which insurers do not want to be located,” such as those related to pandemics or cyber risks.

“The second objective is also to open up competition a little and to 'boost' the insurance companies," he added.

A sub-amendment by the rapporteur aims to set a ceiling in the law, a point that still needs to be worked on, according to the Minister in charge of Public Accounts Gabriel Attal.

“We have a real doubt about the level, what we would like to avoid is that the provision is rendered inoperative with a ceiling that is too low," he said.