UK Signals Progress on Captive Insurance Regime Consultation

The United Kingdom's Prudential Regulation Authority (PRA) is preparing to consult on a new captive insurance regime this summer, according to a report by Steve Hallo published by AM Best. The effort is being driven by a broader legislative initiative led by HM Treasury to establish a framework supporting captive insurance by mid-2027.

According to Mr. Hallo's article, proposed reforms include enabling protected cell company structures and updating the framework for insurance special purpose vehicles (ISPVs), which the Bank of England has described as tools for securitizing insurance risk and facilitating capital markets participation. The PRA indicated that the broader goal is to enhance the UK's competitiveness as a captive domicile and expand access to captive insurance solutions.

However, Mr. Hallo reported that legislative changes required to support protected cell captives will not be finalized in time for the upcoming consultation and will therefore be excluded from the initial phase of the regime. These elements are expected to be addressed separately, with the overall regime still targeted for launch in summer 2027.

The PRA also plans to build on recent efforts to streamline authorization pathways for certain ISPVs and explore additional measures to improve flexibility and accessibility, Hallo wrote. Industry response has emphasized the importance of a proportionate regulatory approach that reflects the distinct risk profiles of captive insurers compared to traditional commercial insurers.

Source: Steve Hallo, "UK Regulation Authority Reveals Details of Captive Regime Consultation," AM Best BestWire, April 30, 2026.

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