“WE ARE USING THIS OPPORTUNITY TO PROACTIVELY DRIVE THE
CAPTIVE CONVERSATION AS IT RELATES TO CAPTIVE BEST PRACTICES.”
The importance of IMAC can’t be overstated, Scott said. “The
only way a jurisdiction can overcome the challenges and embrace
the opportunities is by having this kind of environment which IMAC
“It’s all about the jurisdiction, and bringing together the best
minds, thoughts and ideas and to share those for the benefi t of the
jurisdiction and clients. I think it’s a tremendous advantage and one
which is not easily replicated.”
Looking at the future of the captive industry
“Despite continued growth in the numbers and size of captives, and
the proliferation of captive domiciles, I feel the captive model remains
underutilised, in both new and existing markets,” Haddleton said.
“Emerging industries and risks are at an all-time high—think of the
shared economy space. It is up to captive domiciles to be receptive
to sustainable captive business plans in order to facilitate these risks
and thereby guarantee new sources of business, so as to keep up
the momentum in this extremely useful alternative risk sector that has
so much to offer.”
Trenouth suggested that the captive industry in Cayman should
divert some attention to different geographical markets such as Latin
America, Asia, Canada, and the opportunities these may offer.
At the moment, 90 percent of the risk from the captive market
business originates from North America, Sadlier said. However, the
other 10 percent is diversifi ed between Latin America, Asia, and
Europe. “We’re seeing an increase in growth from those jurisdictions,
looking to startup operations in the Cayman Islands or to redomicile
from those jurisdictions. So that diversifi cation is certainly happening,”
The captives industry is also veering away from the ‘traditional’
P&C business and adding other lines such as cybersecurity,
“This speaks to the success of the market in that in our clients’ view
the captive is critical to the business and they are looking to utilise
the captive for other coverage types.
“Despite the soft market in the US, we see a huge amount of
potential for continued growth in the group captives space,” she said.
“We have seen more interest in blockchain technologies from an
28 cayman captive 2018
underwriting perspective, with telematics and the use of sensors
which can improve the overall underwriting process,” Poole said. It will
make the industry a lot more effi cient also from the claims process.
Sadlier noted that as the technological changes evolve quite quickly,
there are lessons learned from those technologies: what works, what
doesn’t, where the risks are and how to identify them.
“From CIMA’s perspective, we are continuing to research those
technologies to understand the risks they pose, to understand
the opportunities they present for the licensees and to use
that understanding in the context of our regulatory framework,”
The world has become a lot more complicated and connected
as well, Poole noted. He mentioned supply chain interruption with
hurricanes that can have a big impact on clients.
There is an opportunity, when looking at big data, specifi cally at the
captive insurance industry, Scott noted.
Current trends in the captives industry
Trenouth said that BDO has seen a reduction in some smaller
captives, for example where small healthcare systems are being
merged into other systems, but that there is a trend in audit gains
from larger entities, SPCs and group capitals.
Board meetings are delivering a much higher level of engagement,
Byrne said. “Whereas years ago, you’d have a passive management
positioning, now there’s a focus on providing proactive value,
initiating strategic discussions with boards at each meeting.”
Sharing good ideas which worked with similar clients changes
the board’s expectations. “There has been a material increase in
engaging client dialogue more than before,” Byrne said.
Cyber and the benefi ts business is getting most interest at
the moment, Poole said. However, most important is to talk to clients.
“What we’re seeing is existing captives expanding their uses,”
The importance of big data
Technology is driving effi ciencies, Scott said. When you accumulate
large volumes of data it is essential to have the capability to analyse
the data, and to mine the data that has been sitting idle. “We are