I just saw the captive manager survey in the current Captive Review and I have to say that I was not surprised by the number one concern expressed by the respondents: the tightening global accounting standards and regulations. The captive industry has been raising this issue, and more broadly the over-regulation of our industry from a number of quarters, for the last few years as we continue to feel the fallout of the global financial services crash – even though the insurance industry withstood the crash with flying colors. As VCIA board chair, Bill Riley, so succinctly put it earlier this year, the captive industry is facing a three-fold threat developing over the next few years: (1) excessive regulation resulting from insufficient knowledge; (2) the weakening of sound regulatory structures based on a desire to attract business; and (3) efforts to impose new or increased taxes. Like fighting crime, we all need to act as police in combatting these threats to our industry. And like fighting crime, you never win the war outright – all you can do is try and chip away at the ignorance.
On a more positive note, I am interested in the notion from the survey that medical stop-loss and employee benefits were the top two lines that have shown the biggest increase in interest from captive clients. I feel like for the past four years or so these two lines have always been right about to pop, but never do. I would love to hear from you on whether you think the environment is really ready for stop-loss and employee benefits to take off (or at least begin to accelerate). Let me know!
Have a great weekend and, hopefully I will see many of you next week in Vermont at our conference. Thank you all very much and I look forward to hearing from you!