Aon plans to launch UK captive management company

By Rebecca Delaney

July 15 - (The Insurer) - Aon said it will launch a UK-domiciled captive management company after the UK government announced on Tuesday that it is looking to implement an onshore captive insurance framework over the next two years.

In response to a consultation on a UK captive framework, the government said the Financial Conduct Authority and Prudential Regulation Authority plan to consult on policy proposals in summer 2026, with aims to implement the regulatory framework by mid-2027.

"We are fully supportive of the government’s announcement which will position the UK firmly on the global captive map," said Ciaran Healy, global captives leader at Aon.

"’The UK is already home to the world’s leading insurance marketplace in London and it’s only natural that it should also be a competing jurisdiction for captives. The UK has the expertise, reputation and drive for innovation that will ensure success – and here at Aon we are already very advanced in our preparation to launch a new UK-based captive management company."

When the new regulations come into force, Aon said its new UK captive management company will provide greater choice on where clients can domicile their captive insurance company and structure their risk finance programs.

The consultation presented two options for the regulation of captive managers: utilising the existing regulatory regime for insurance intermediaries (as is the current approach for broking firms whose activities extend to captive management) or introducing a separate regulatory approach to captive managers.

The former was expressed as the government's preferred option, although it noted that the 42 respondents from the insurance sector had diverging opinions. Some argued that changes to the current regime (particularly a simplified authorisation processes) would be beneficial, while others said a new regime would be useful to align the UK's captive insurance market with international regimes.

A new regulated activity "is not considered necessary" to regulate captive managers, the government said in its response.

"The government does not intend to create a bespoke regulatory framework for captive managers, as it considers that the existing regulatory framework for insurance intermediaries is sufficient," it confirmed.

Last month, The Insurer canvassed multiple UK insurance market participants at the Airmic annual conference on the prospective captive insurance regime.

Market participants were unified in their support for a framework based on proportionality, although opinions differed around the likely speed of new formations and re-domiciliations to take advantage of the regime, as well as potential parallel legislation for captive management licensing.