AMSTERDAM--(BUSINESS WIRE)--Commercial insurance rate increases are driving an uptick in the use and importance of captives in Europe, as tools to provide their owners with the flexibility to navigate the insurance cycle and maintain access to cover on an ongoing basis, according to analysis from AM Best.
A new Best's Market Segment Report, “Europe’s Captives Show Their Worth Amid Changing Market Dynamics,” highlights an uptick in the use of existing captives in response to the hardening market conditions, and notes that several European captives have increased retentions or limits on existing cover, as well as expanded into new lines of business as their parents have looked at increasing captive utilisation.
However, the report explains that while the hardening market provides opportunities for captives to demonstrate their value, it also presents challenges. Many captives are highly dependent on reinsurance capacity to be able to offer the large limits required by their parent groups and even those with good claims records are likely to face price increases for their reinsurance programmes in the 2023 renewals.
To access a complimentary copy of this market segment report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=326621.
AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.