Statement
The Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) welcome HM Treasury’s (HMT) plans to support the growth of the UK’s captive insurance market. We are committed to playing our part by developing a proportionate authorisation and regulatory regime for captives reflecting the lower risk they pose. We will launch consultations in summer 2026 on the rules and policies for an effective and competitive UK captive insurance regime. Our consultations will be based on the scope outlined in HMT’s consultation response. We particularly welcome HMT’s commitment to introduce legislation to enable captives to be established within protected cell companies (PCCs). Use of PCCs can widen access to the benefits of captives by providing a more affordable route for smaller businesses. It can also serve as a pilot option for larger corporates taking their first steps towards establishing standalone captives. This is an important step in the development of a competitive UK captives sector.
Captive insurance is a means of self-insurance and risk management by commercial entities and, less often, by public organisations.
We are committed to supporting HMT’s initiative and contributing to the competitiveness and growth of the UK economy. We will work with HMT and a wide range of stakeholders, including users of captives as well as financial services firms, to deliver the regime. The PRA, in cooperation with the FCA, will set up subject expert groups with these stakeholders as soon as practicable, to gather feedback for policy development and technical matters.