PRA and FCA unveil draft proposals for captive regime

The Prudential Regulation Authority (PRA) and Financial Contact Authority (FCA) have given captive insurers, captive managers and service providers until October 14 to respond to a consultation they have launched for its first tailored captive insurance regime.

The two regulators, which are working together on a new bespoke regulatory framework for captive insurance in the UK, have published two papers, which together are designed to form a coherent overall framework for captive insurance in the UK.

The consultation covers single-parent captives. The regulators describe these as captives that generally pose lower risks to market integrity and consumer protection as they are only permitted to insure or reinsure risks of their group entities and parties connected to the group.

The documents cover everything from which types of risks captive can insure, and on what basis (many will be reinsurance only) timelines for approvals, fees and minimum capital requirements – set at £100,000.

Captive International will provide further details and updates in the coming days.

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