Captive Formations Accelerating Globally, Notably Rising for New Zealand and South American Firms – GILC

Key Takeaways

• Global captive formations up sharply in 2026
• New Zealand sees fastest captive growth
• South America experiences notable captive surge
• Rising premiums, tighter capacity drive demand
• GILC report spans 20 jurisdictions

Summary

The 2026 Global Insurance Law Connect (GILC) report shows a sharp acceleration in captive insurance formations worldwide, driven by rising premiums and tightening capacity in the broader market. Growth is especially pronounced in New Zealand and across South American jurisdictions, where new captives are outpacing global averages. The report aggregates data from member law firms operating in 20 jurisdictions, highlighting a structural shift toward alternative risk‑transfer solutions. Industry observers see this trend as a response to volatile underwriting environments and regulatory openness.

Pulse Analysis

Captive insurance entities have long served as bespoke risk‑management tools for corporations seeking greater control over underwriting and capital allocation. In 2026, the confluence of rising insurance premiums and constrained capacity has intensified interest in these structures, as firms look to internalize risk and achieve cost efficiencies. The GILC report underscores that this macro‑level pressure is not uniform; instead, it is catalyzing a wave of new captives in regions where regulatory frameworks are becoming more accommodating.

New Zealand and South America stand out as the most dynamic markets in the latest data. In New Zealand, a combination of favorable tax treatment, supportive legislation, and a growing awareness of captive benefits has propelled formation rates beyond global averages. South American countries, traditionally slower to adopt captive models, are now witnessing a surge driven by volatile local economies, currency fluctuations, and a desire for localized risk solutions. Law firms in these jurisdictions report heightened client inquiries, indicating a maturing market that could attract cross‑border capital.

The broader implications are significant for insurers, reinsurers, and advisory firms. As captives proliferate, they generate new underwriting opportunities, ancillary services, and a demand for specialized legal expertise. Investors may also view captives as a conduit for accessing niche risk portfolios. Looking ahead, sustained premium growth and capacity constraints are likely to keep the captive formation momentum alive, prompting regulators to balance oversight with the need for innovation in risk transfer.