By Jailani Hasan
LABUAN, Nov 10 -- The Labuan International Business and Financial Centre (Labuan IBFC) has been named as the Top International Captive Domicile of 2021 at the European Captive Review Awards, held in Luxembourg on Nov 9 by Captive Review, a leading global trade publication.
The European Captive Review Awards is dedicated to captive insurance and risk management expertise; giving domiciles, service providers, captive owners and other industry stakeholders a platform to showcase the highest levels of excellence and innovation.
Captives insurance is a formal plan whereby a business owner forms his or her own bona fide insurance company, where the insurance coverages are tailored to the needs of the business.
To date, there are approximately 7,000 captive insurance companies set up globally.
In a statement to Bernama today, Labuan IBFC Inc. chief executive officer Farah Jaafar said the award was proof of the growing recognition and acceptability of the Labuan self-insurance propositions in Europe, owing to its well-regulated and extensive range of structures, proportionality in regulations, as well as its wide and deep reinsurance marketplace.
This is the first time that the jurisdiction has won the Top International Captive Domicile award at the European Captive Review Awards, having won the Best Asian Domicile award for three consecutive years at the Asian Captive Review Awards.
“Labuan IBFC’s captive insurance business has continued its upward trajectory in 2021, and nine new captives were formed as of Sept 30.
“We are now home to 64 captives, and in terms of premiums, 70.2 per cent were from international markets - clearly indicating a coming of age and maturity of the market, making Labuan IBFC a global domicile of choice,” she said.
Farah said the availability of cell captives, master rent-a-captive (MRAC) and subsidiary rent-a-captive (SRAC) allows for the ‘democratisation’ of self-insurance vehicles, lowering entry barriers for small and medium-sized companies.
“It has been a long-standing belief that self-insurance vehicles like captives were only accessible to large multinational corporations and businesses.
“However, cell captives and the steeper insurance renewal rates, as well as the inability to find cover for certain segments of risks, has increased the understanding and interest in self-insurance,” she said.
Farah said Labuan IBFC is Asia, the Middle East and North Africa’s fastest-growing risk and reinsurance wholesale intermediation market, boasting more than 220 license holders.
“Labuan IBFC is also the only jurisdiction in Asia that provides for the protected cell company (PCC) structure, with more than 10 PCCs licensed to date.
“Industry practitioners, via the Labuan International Insurance Association (LIIA), have recently set up a globally represented captive subcommittee to strengthen the captive proposition via close cooperation and discourse with Labuan IBFC’s regulator, Labuan Financial Services Authority,” she said.
Meanwhile, Labuan IBFC and LIIA will be jointly organising the fourth Asian Captive Conference, themed “Democratisation of Self-Insurance: Benefitting from cell captives in a challenging insurance market” on Dec 2, 2021.
The virtual conference is open to all risk management professionals, business owners, leaders of global corporations and corporate advisers.
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