9 November 2023news

Towle hails golden age of captives

The captive insurance industry is experiencing a golden age at the moment, according to Dan Towle, president of the Captive Insurance Companies Association (CICA).

Speaking at the opening of the European Captive Forum in Luxembourg Towle told delegates that the industry has endured and triumphed over the decades through many challenges and growing pains and is now in a sustained period of continued growth and prosperity.

“We are experiencing the Golden Age of captive insurance,” Towle said. “This truly is an incredible time for the captive industry and one that should be recognised and appreciated. We have come a long way.”

Towle said that he has been in captive insurance for nearly thirty years and has navigated hard and soft market cycles, as well as working through periods where the industry was constantly under attack.

He stressed that captive insurance has now proven its business purpose and value over a prolonged period of time and that no one can legitimately refer to the captive industry as the alternative market any longer.

“We are seeing market growth from unprecedented rates of new captive formations and captive expansions, and it is not exclusive to large organisations,” he said. “Mid-market and non-profit organisations are turning to captive insurance in record numbers. They are using captives to address the same hard market business and economic issues as larger organizations. The acceleration of cell captives has helped spur this growth.”

According to Towle, as more businesses turn to captive insurance, captives are becoming more sophisticated than ever and are more strategic than they were a decade ago. New technology, better data and evolving risk strategies are giving captives the edge in providing coverage ahead of what the commercial market can provide, he said.

Towle added that it is exciting to see this growth and expansion and that he believes this gives a unique opportunity to highlight the value of captive insurance to an even wider market. He explained that the captive insurance industry is often misunderstood by the mainstream media, governing regulators and others and that as it continues to grow, it attracts more attention, creating the need to consistently educate, lobby and defend the use of captives for better risk management and financial efficiency.

“Despite our success, we cannot rest on our laurels,” Towle warned. “Those of us in the industry who embrace and celebrate best practices know how important captives can be for protecting the risks of their company ─ and for providing predictable pricing and coverage during a volatile insurance market. Captives are more than just a response to current market trends, they often create a foundation for organisations to invest in better-managing risks, avoiding losses, and keeping individuals and properties safe.”

Towle concluded by welcoming the emergence of new captive insurance domiciles throughout the world, saying that it is encouraging to see France enter the marketplace in Europe and that many continue to watch Lloyds with interest. Towle also said that CICA is also seeing interest from Italy, Germany, Spain and the United Kingdom, which clearly signals the growing understanding of the value of captive insurance.


More on this story

Executive Appointments
1 July 2021   The European Captive Forum (ECF) is planning to go ahead as an in-person event in November.
Actuarial & underwriting
12 November 2018   European captive ratings have been stable through the past year, with most ratings affirmed and stable outlooks maintained, according to an AM Best report.
Analysis
17 September 2018   Solvency II, Brexit and OECD BEPS are some of the influential forces reshaping the captives domicile landscape in Europe, and many captive owners are looking at the growing attractiveness of onshore vs offshore, explains Ciaran Healy of Willis Towers Watson.

More on this story

Executive Appointments
1 July 2021   The European Captive Forum (ECF) is planning to go ahead as an in-person event in November.
Actuarial & underwriting
12 November 2018   European captive ratings have been stable through the past year, with most ratings affirmed and stable outlooks maintained, according to an AM Best report.
Analysis
17 September 2018   Solvency II, Brexit and OECD BEPS are some of the influential forces reshaping the captives domicile landscape in Europe, and many captive owners are looking at the growing attractiveness of onshore vs offshore, explains Ciaran Healy of Willis Towers Watson.