From: Captive International

Aon’s new Captive Benchmarking Survey shows that hardening insurance markets are pushing more organisations to consider alternative risk solutions. The survey finds captive and protected cell usage has increased across most industries in the past two years, with particularly pronounced rises in use to manage property damage/business interruption, directors’ and officers’ and cyber risks.

“It is 20 years since we have seen such captive growth on a sustained basis across all of our operations,” wrote John English, chief executive officer for captive and insurance management at Aon.

According to the broker, since 2018, there has been a 73% increase in premium retention among captives it managers, including a 361% increase in property damage/business interruption retentions and a 26% increase in general liability retentions. These areas still make up the lion’s share of premium volume written by Aon’s client captive insurance entities, but captives are increasingly used for other risks.

“Alongside these more traditional risks, some organisations are innovating and using their captives to support their risk management strategy for several hard-to-place or emerging risks, like cyber and environmental,” he continued.