Towle bullish on US captive market
The US captive industry will remain strong throughout 2025, even with a softening insurance market among some lines of coverage. That’s the message from Dan Towle, president of the Captive Insurance Companies Association (CICA), ahead of the opening of CICA’s 2025 conference, located in Tucson, Arizona.
“I am still very bullish on the current captive market,” Towle told Captive International.
Towle said history has shown us that premium dollars flow into captives and usually do not go back to the traditional market. If a line of coverage may soften, those premium dollars are often deployed elsewhere in the captive. There is still a lot in the world that is uncertain, and the captive industry is here to stay.
Towle expects another great year for captive insurance. According to him, there are a lot of things driving interest in captives in the current market. Control is still one of the biggest factors that will always be attractive to companies considering formation. Companies utilising captives are seeing the long-term benefits in both hard and soft markets and will not be leaving the market anytime soon.
Captives have been gaining more attention in the last few years during this period of growth, he said. What was previously thought of as “an alternative risk market” has proven to be a successful and flexible solution to a wide range of companies, Towle explained. It is now mainstream as companies flourish with their captives, and some of those premiums will never go back to the traditional market.
Asked if CICA will be taking a position on the IRS’s recent 831(b) ruling, Towle replied: “CICA has a long history when it comes to captives electing section 831(b). In 2014, CICA came out with our White Paper, ‘Do 831(b)s Right or Don’t Do Them at All.” That position still stands today, and we believe it applies to captives of all sizes. We provided robust comments on the IRS’ Proposed Regulations in 2023. CICA has been an unwavering proponent of having captives formed for risk management purposes and for operating them utilising industry best practices. We are monitoring the effect of the IRS’ recent regulation closely.”
Looking at CICA’s NextGen and Amplify Women initiatives, Towle said that these are continuing to grow and provide educational and networking opportunities to professionals looking to grow and develop their careers. To date, CICA has over 500 subscribers combined in both programmes.
This year, CICA has new virtual networking webinars led by industry leaders who will share their experiences and knowledge. At CICA’s 2025 conference, there will be six sessions focused on professional development and the Amplify Women and NEXTGen initiatives, Towle said. The Association also offers many networking opportunities before and during the conference in relaxed settings which attendees find valuable to maintaining and building industry connections.
Finally, Captive International asked Towle what message will he will be giving to the market as CICA opens.
“The industry is continuing to grow, showing more interest in new formations and the expansion and greater utilisation of existing captives,” he said. “This is not slowing down any time soon. It is vital to keep our industry strong and remain at the forefront of finding solutions for the insurance industry.”
Towle added that CICA’s annual conference draws on the best and the brightest from all domiciles, and that CICA welcomes their insights to shape the future of captive insurance. CICA believes that its conference brings together the most captive insurance intellectual capital in the world.
“This is an amazing opportunity to learn from and network with the very best across the industry and all the leading domiciles,” Towle concluded. “If you are not going to be there, you are missing out!”
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