CAPTIVES 202
CAPTIVE PREMIUM gross written premium (2008) €1.84bn (Dima survey)
LEGISLATION various acts and statutory instruments as listed on Central Bank and
Financial Services of Ireland (CBFSI) website, including guidance note ‘Operational Guidance on Prudential Requirements Applicable to
Captive Insurance Undertakings’
CAPTIVE TAX RATE 12.5%
FEES no application fee; annual fee dependent on premium volume
REGULATOR CBFSI (pending approval)
Dublin is a well-established centre for both reinsurance and direct writing captives. Among its captive owners are plenty of household names such as the Coca-Cola Company, McDonald’s Corporation and Heinz. Irish companies with captives include Kerry Group.
Although the first captives came from within Europe, more recently a lot of growth has come from the USA, which now accounts for the highest number of captive owners. An industry insider says the ability to passport into the rest of Europe has remained a key factor. Like all domiciles, the financial crisis has had an effect but there is some cautious optimism due to its stable tax regime coupled European links and a good infrastructure.
Dublin International Insurance & Management Association (Dima) chief executive Sarah Goddard says: “Although the Irish economy has been somewhat buffeted by the global economic crisis, the international re/insurance sector in Dublin has continued to grow. “The reasons for its success still apply: a sound, experienced and intelligent regulatory environment, a stable tax regime with a wide and expanding network of double tax treaties, a pool of talented and experienced captives professionals and an infrastructure that has been developed with the needs of the sector in mind. In addition, the economic changes have brought costs down, which is contributing to even greater fiscal efficiency."
But not everyone is quite so positive. One industry insider says: “Ireland is a captive domicile but they don’t seem to be quite as sympathetic to captives.” He says it is not a direct criticism of Dublin but that other domiciles perhaps have “a more sympathetic attitude”. Others do not agree, saying Dublin is attractive for international, and particularly US, companies. They are confident it will continue to grow.
