On paper, the UK’s proposed captive regime would address the main regulatory barriers to setting up here. Whether it actually brings captives onshore is a different question, now that the PRA and FCA consultation on the bespoke regime closed on October 14.
Published in July, the proposals would create a distinct category of UK captive insurer outside Solvency UK, with lower capital and reporting requirements, simplified governance and a target authorisation timeline of four to six weeks. A single captive would be able to write business on both a direct and reinsurance basis. The regime would initially cover single-parent captives only, with the regulators planning to consult separately on extending it to protected cell companies once the necessary legislation is in place. It is due to launch in summer 2027.
The stated ambition, following the chancellor’s July 2025 Mansion House commitment, is to make the UK the location of choice for captive business and to bring home captives currently domiciled offshore.
Esme Gould, head of captives and ART at Zurich UK, said a UK regime has the potential to strengthen the country’s position as a leading global insurance centre. “The proposed regime recognises the distinct nature of captive insurers and introduces a proportionate approach that should be competitive with existing regimes.”
Anthony Brown, GB captive advisory lead at WTW, said the proposals put “true proportionality at its heart” rather than trying to make captives fit the existing UK solvency and regulatory framework, and together address the main barriers that have historically made the UK impractical as a captive domicile.
Before implementation, he would like more clarity on how boards should assess capital above the minimum requirement.
“The rules are an excellent starting point which should be welcomed but the regime’s credibility will ultimately depend on whether the promised speed, proportionality and regulatory accessibility are delivered consistently in practice.”
Brown would also like more clarity on the timetable for legislation enabling straightforward redomiciliation into and out of the UK.
Beyond regulation sits tax, which the PRA has acknowledged falls outside its remit. For Brown, it is “always a material although not necessarily decisive factor”.
“A strong regulatory framework may put the UK on the shortlist, but businesses will assess the overall economic outcome.”
Captive owners will value the UK’s legal and insurance expertise and its proximity to shareholders and board members, he said, but the combined cost of tax, capital, governance and administration must remain competitive with established domiciles.
Brown said brokers should start engaging with clients now rather than waiting for the final rules, including approaching regulators early to identify potential issues before a formal application is submitted. Planning also needs to be realistic: the four-to-six-week target covers the regulatory assessment stage, not the full formation timetable.
The regulator appears to be open to that. David Bailey, executive director for prudential policy at the PRA, said when the proposals were published in July that it is “keen to speak to any businesses that could benefit” from establishing a UK-based captive.
The regulatory framework is taking shape. Whether it brings captives onshore will depend on the overall economics and whether the promised speed and proportionality hold up in practice.
