AMRAE hopes for French captive legislation by the summer

French risk managers can expect comments from the European Commission on proposals to help with the creation of captives and broader self-insurance provisions in France in the near future.

Legislation will follow hopefully by the summer but certainly before the next year-end renewals, according to AMRAE president Oliver Wild.

During AMRAE’s 2022 annual conference, Wild updated members on the progress of the association’s campaign to make it easier for French companies to create captives in France.

Wild explained that while it is disappointing that provisions for captives and other self-insurance mechanisms had not been included in the latest French Finance Bill, he is confident that it will happen this year.

This will hopefully mean that French risk managers can enjoy the same kind of environment for captives as other onshore EU domiciles – such as Luxembourg, Ireland and Malta – making the country a “fertile land for captives”, Wild told Commercial Risk Europe.

“On captive solutions, in the government and at all levels it is agreed that provisions are needed for self-insurance for smaller companies and captives for larger companies. It is agreed that more flexibility is needed to set aside provisions for a rainy day,” Wild explained.

“We expected legislation in France at the end of the last quarter but that did not happen. We then decided to submit the proposals at EU level because France has presidency of the EU. Comments are expected in the next couple of months and legislation hopefully in the summer, but certainly before the renewals of January 2023,” he added.

“The proposals are not that different from those in place in Ireland and Luxembourg, so don’t expect any major changes from those. This will allow France to become a fertile land for captives. Currently, there are only nine or ten French captives. But our latest survey identified at least 50 captive projects underway, obviously stimulated by the hard market,” continued Wild.

Wild said another great benefit of captives is that senior company managers and directors such as the CFO will join the captive board, thus raising awareness and appreciation of the value of structured risk and insurance management.