Commenting on the Chancellor’s announcements to reform captive insurance, Krish Kistnassamy, Head of General Insurance, IFS, Hymans Robertson, says:
“We’re hugely supportive of the joint HMT-PRA efforts to make the UK a more attractive jurisdiction for Insurance Special Purpose Vehicle (ISPVs) and insurance captives. The alignment between government and regulators, and political support, is pleasing and suggestive of change that could make it easier for industry to set-up these vehicles in the UK.
“Changes to the framework have the potential to make it straightforward and cost-effective for a UK corporate to set-up a cell in a Protected Cell Company (PCC), to act as a captive to manage all of its insurance risk domestically, or for insurers to use a cell as a transformer vehicle to obtain capital market capacity for their reinsurance risks. Changes to the legal framework, combined with indications of a more proportionate approach by the PRA, would help the UK compete in the securitisation of insurance risks. This comes at a time when this capacity might be even more needed by Society due to climate change and greater cyber risk.”
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