PRA welcomes UK risk transformation reforms, plans new regime

The PRA has committed to consulting on a new insurance captives regime in Summer 2026.

This initiative aims to significantly increase the attractiveness of the UK as a global hub for wholesale insurance services, simultaneously widening access to the crucial risk management benefits offered by captive insurance.

The new regime is expected to launch in Summer 2027.

However, due to legislative changes not being in place in time, the use of Protected Cell Company (PCC) captives will not form part of this initial consultation, nor will it be included in the regime at its launch.

The PRA will continue its close collaboration with HM Treasury to integrate PCCs into the regime once the necessary legal framework is established, further enhancing the accessibility and benefits of the UK's captives framework.

The PRA has already enhanced the UK's Insurance Special Purpose Vehicle (ISPV) framework through reforms introduced in 2025, which included an accelerated pathway for certain ISPVs.

Further ISPV reforms are planned for consultation, aiming to add simplicity, flexibility, and access, and to improve PCC use for ISPVs once legislative barriers are removed.

These combined efforts, encompassing both the existing ISPV regulations and the new captives regime, are designed to support the competitiveness and growth of the UK's insurance sector and the wider UK economy.