The Labuan International Business and Financial Centre (Labuan IBFC) registered seven new captives in the first half of 2020, more than the entirety of 2019.
These new additions brings the total number of captives registered in the jurisdiction to 56, a growth of 9.8% year-on-year.
Of the seven new captives formed, four are foreign owned and three are Malaysian entities, a ratio which Labuan IBFC says reinforces its role as a regional risk intermediation hub.
In terms of gross written premiums, Labuan’s captive insurance business accounts for 31.4% of the total gross premiums underwritten in Labuan IBFC amounting to $267.9 million, with 72.8% of the total premiums originating from international markets.
In contrast for the whole of 2019, Labuan IBFC recorded a 14.2% growth in total gross premiums for its captive insurance business amounting to $457.5 million.
“This steady growth could be attributed to the heightened understanding of the benefits of self- insurance in Asia and the hardening reinsurance market,” said Labuan IBFC CEO, Farah Jaafar-Crossby.
“Other factors could include changes in the international tax landscape, prompting companies to seek midshore jurisdictions like ours in order to ensure tax compliance.”
“Labuan IBFC is the only jurisdiction in Asia with the protected cell structure and with the ongoing pandemic, there has been a heightened interest in PCCs as a cost-effective self-insurance vehicle. As such, we will be hosting the 3rd Asian Captive Conference, themed ‘Agility in the COVID Climate’ on 10 November,” added Jaafar-Crossby.
