Insurance Marketplace Realities 2026 Spring Update – Captives Insurance

Key takeaway

• Continued global turbulence is reinforcing the importance of robust risk management and risk financing strategies.
• Captive utilization remains strong despite continued easing in commercial property pricing, driven by:
  • Natural catastrophes and losses from secondary perils remain high.
  • Continued stress in casualty, auto-liability, excess and healthcare related lines where social inflation and third-party litigation funding.
• Interest in using the captive to structure parametric solutions, especially around climate and environmental risks, remains strong, as clients seek capacity that may not be available in traditional insurance markets.

U.S. domiciles

• New captive formations continued to be strong in 2025, with Vermont reporting 51 new captives licensed and 36 new cell captive formations. Delaware reported 51 new captive (including cells) formations, and North Carolina reported 21 new captive formations and an approximately 80 cell and series entities.
• Strong interest in the captive market surrounding the use of analytics to optimize how the captive’s capital is deployed. Resulting in expansions to the captive’s business plan, a return of capital to its shareholders, or maintaining a capital position to combat future commercial insurance market turns.
• Renewed energy around non-U.S. employee benefit captives. Aside from the savings they may generate, they also help in creating a greater diversified portfolio of risk within your captive program.
• Early 2026 captive conferences are seeing record attendance numbers, suggesting continued interest in captive utilization and expansion in 2026.

Americas offshore

• The key Atlantic and Caribbean domiciles of Bermuda and the Cayman Islands continue to see growth in the number of new captive insurance licenses issued.
• For the full year 2025, nine new captive licenses were issued in Bermuda and 58 insurance licenses in total. This compares to 17 new captive licenses issued in 2024 and 16 in 2023. Overall licenses issued in 2024 were 63, with both 2025 and 2024 license numbers heavily driven by SPI and Collateralized Insurer license classes.
• As previously reported, there have been numerous Segregated Accounts (Cells) formed during 2024 and into 2025, but statistics for these have not been published.
• 2025 saw the first interim corporation tax payments by Bermuda entities following the introduction of Bermuda CIT, contrary to expectations, we are not aware of captives leaving Bermuda because of CIT currently.
• In the Cayman Islands, during the second half of 2025, CIMA issued a further 22 new licenses (full year - 42), compared to 20 licenses issued during the same period in 2024 (full year – 42).
• There continues to be growth in Segregated Portfolios (cells), Portfolio Insurance Companies (incorporated cells) and members in group captives. Although statistics are not published, a recent survey conducted by the Insurance Managers Association of Cayman, calculated the number of members of group captives in excess of 10,000.
• As at end of year 2025, Cayman licensed entities held total assets more than $176 billion, writing annual premiums of over $51 billion. The life and annuity sectors counted for $84 billion of these assets and over $12 billion in premiums.

Outlook

The outlook for 2026 is for the observed trends in 2025 to continue as captives are further embedded in enterprise risk management strategies. Not only to help save costs, but as a strategic enabler of resilience and risk financing innovation.