Captives at the Core: The Foundation of a Risk Financing Strategy
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Captives at the Core: The Foundation of a Risk Financing StrategyThis marks the 10th year that we have published an in-depth captive report. Based on data from over 1,100 captives managed by Marsh, this year’s report focuses on understanding how captives are being used depending on geography, risk issue, and/or industry, surfacing opportunities that may exist for greater utilisation.

Among the key findings from the report:
  • Since 2006, there has been a 40% increase in the number of captives formed globally.
  • In the face of growing global economic and political uncertainty, and disruption from technology innovation, companies view captives as being at the core of innovative risk management strategies.
  • Funding corporate retained risk is a key value driver of captive formation, providing the flexibility to adjust risk retention strategies in response to market cycles or changes in exposures.
  • In the past, most captives were formed by parent companies from North America and Europe but, over the past three years, there has been increased interest from emerging geographies.
  • There has been, in recent years, an expansion of captive use in industries other than the traditional financial services, health care, and manufacturing sectors – although they continued to dominate the captive arena in 2016.
  • Parent companies concerned about economic volatility, rule of law, and government instability are using their captives as a lever to address complex coverages related to geopolitical risk.
The report also analyses the growth of captives throughout the Americas, Europe, the Middle East, and Asia-Pacific, discusses tax and regulatory changes affecting captives, and provides recommendations for current and prospective captive owners.

To view the full report, please download the PDF.

You may be interested in content produced by other Marsh & McLennan Companies outside of the MENA region. Please be aware that these are not produced under MENA regulations and Marsh Ltd can take no responsibility for their content.


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