PRA makes UK captive regime a 2026 priority

The UK’s Prudential Regulation Authority (PRA) has underlined its intention to press ahead with developing a UK captive insurance regime in its newly published 2026 supervisory priorities letter. 

The letter confirms plans for a consultation on the captive regime in summer 2026, with the aim of introducing the new framework in 2027.

The UK Treasury confirmed its intention to press ahead with implementing a “genuinely competitive, bespoke captive insurance framework in the UK” in July 2025, earmarking mid-2027 as when the new framework could be implemented.

The potentially broad scope of the framework suggested in that announcement was widely praised by the UK insurance industry.

The supervisory priorities letter was sent yesterday to banks, insurers and other PRA-regulated firms and sets out its sector specific priorities for the coming year.

The letter on insurance supervision also highlights in a section on international competitiveness and growth its reforms that have been implemented to the UK’s Insurance Special Purpose Vehicles regime “to widen the types of insurance-linked securities structures available in the UK, and to streamline the authorisation process.”

Other PRA initiatives being worked on include accelerating timelines for new firm authorisations; developing options that enable small/medium insurers access to a dedicated point of contact on regulatory matters, including when looking to launch new products; and working with the FCA to consider how best to support the mutuals landscape.

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