Trends, risks, and growth opportunities
In the second of our exclusive Captive International surveys on the state of the Cayman Islands captive insurance market, we look at trends and other data on the domicile.
The Cayman Islands continues to attract global attention as a premier jurisdiction for captive insurance, thanks to its favourable regulatory environment, infrastructure, and extensive expertise.
According to the results of Captive International’s second survey of its readers on the state of the Cayman captive insurance market, as more companies look to self-insure and mitigate a range of risks, the market is seeing notable trends in interest levels, risk transfer preferences, and strategic challenges.
Among companies considering forming a captive for the first time, the majority (61 percent) are confident about using the Cayman Islands but have some remaining questions. This high level of confidence in Cayman’s capabilities suggests that the jurisdiction is well-regarded as a leading captive insurance hub. While 17 percent of respondents are bullish on Cayman and eager to proceed without hesitation, an equal percentage have a neutral stance but are keen to learn more.
”Captives offer a versatile solution for a variety of exposures.”
A small fraction (5 percent) expressed nervousness and felt they needed additional convincing to move forward with a Cayman-based captive.
None of the respondents indicated a preference for US onshore options, demonstrating Cayman’s strong position in the offshore captive market. The data highlight Cayman’s reputation and the potential benefits of further engagement and education to address the remaining questions of companies that are confident yet curious.
Are companies considering forming a captive for the first time:
Key risks
As companies evaluate risks suitable for captive insurance, the types of risks they prioritise reflect traditional as well as evolving concerns:
Property risks (65 percent): Property remains the top risk category for captives, highlighting the demand for asset protection amid uncertainties such as natural disasters and global supply chain disruptions.
General/third-party liability, cyber, healthcare, and medical malpractice (all 53 percent): Companies are increasingly transferring liability, cyber, healthcare, and medical malpractice risks to captives. This balanced interest in conventional and emerging risks indicates that captives offer a versatile solution for a variety of exposures.
Employee benefits (47 percent): The inclusion of employee benefits as a primary concern suggests that companies are exploring captives as a way to manage healthcare costs and improve the flexibility and stability of their employee benefits programmes.
Professional indemnity (41 percent): Demand for professional indemnity coverage reflects the growing need for companies to protect themselves against potential liabilities in an increasingly complex regulatory and legal environment.
Additional areas of interest include life insurance (35 percent), environmental risks (29 percent), and employer’s liability (29 percent), further demonstrating the broad utility of captives in managing diverse risk portfolios.
Which risks are companies most interested in transferring to a captive?*
*Respondents could choose multiple options
Opportunities for growth
The Cayman captives market is seeing ample opportunities for growth and expansion. A majority of survey respondents (78 percent) indicated that increasing market share is a top priority. This focus on market expansion shows the overall positive outlook on the potential of captive insurance, as more businesses recognise the value of captives in managing costs and enhancing risk control.
For some respondents (17 percent), profitability improvements through rate increases and cost reduction measures offer a promising pathway for success. Others (28 percent) see expansion into new lines of business or services as an opportunity, signalling the industry’s adaptability to changing client needs and evolving risks. A smaller portion (11 percent) are considering mergers and acquisitions as a route to growth, highlighting the potential for strategic consolidation.
Survey comments emphasise the demand for cyber coverage and access to reliable insurance that supports business growth. This focus reflects the urgency companies feel around cyber risk management, particularly as digital transformation and online threats continue to reshape the risk landscape.
Where do you see opportunities for your business?*
*Respondents could choose multiple options
Challenges and strategic issues
Cayman’s captive insurance market presents growth opportunities, but companies face challenges and strategic issues that could influence their business decisions:
New and emerging risks (67 percent): The top concern among respondents is new and emerging risks, particularly cyber threats and artificial intelligence (AI). As companies adopt more digital solutions, they face complex exposures that require innovative risk management solutions, often making captives a suitable option for addressing these challenges.
Talent management (50 percent): Attracting and retaining skilled professionals remains a top priority for captive managers. With the Cayman Islands’ reliance on specialised talent for risk management, regulatory compliance, and operational support, developing and maintaining a strong workforce is essential to ensuring continued growth and client satisfaction.
Profitability amid economic uncertainty (28 percent): Economic volatility has heightened concerns about profitability, and companies are seeking ways to maintain financial stability while providing competitive coverage options.
Climate change (22 percent): Although not a top priority compared to other challenges, climate change is a significant issue for some companies, as extreme weather events and regulatory pressures necessitate environmental risk management.
Other comments suggest that some companies are interested in Cayman’s organisational framework, indicating a desire for clarity and adaptability in Cayman’s regulatory structure as businesses scale their operations.
What are the other big issues on your agenda?*
*Respondents could choose multiple options
The future
The Cayman Islands remains a leading destination for captive insurance, with a strong reputation and established infrastructure that makes it a top choice for companies seeking to establish captives.
By addressing lingering questions and continuing to educate potential clients, the Cayman captive market can further solidify its position and attract even more companies to its jurisdiction.
Looking forward, Cayman’s captive insurance market is likely to benefit from trends in digital transformation, as companies seek flexible and responsive ways to manage emerging risks such as cyber. The high interest in property, liability, and healthcare-related coverages indicates that captives will continue to serve a diverse array of needs, with growing attention to complex risk areas.
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