The risk manager’s view: maximizing your captive’s strategic impact

Captives are entering a new phase of maturity. Today, many mature captives do more than just insure risk. They can help organizations make better capital decisions, strengthen resilience and support boards navigate an increasingly uncertain risk landscape.

But what does a strategically mature captive look like in practice and what lessons can they share with the wider captive community?

At Zurich’s Captive Dialogue Day 2026, Adriana Scherzinger, Group Head of Captives, Commercial Insurance at Zurich, asked a panel of experienced captive managers just that. And while each captive owner’s perspective is particular to their own unique circumstances, common threads emerged.

The ten-year evolution: what has changed?

Over the past decade, captives have become central to risk financing discussions, observed Daniele Zucchi, General Manager at Sigurd Ruck AG, a captive of engineering and energy infrastructure firm, Saipem.

Ten years ago, Saipem’s captive was used prudently to retain traditional property and casualty (P&C) risks, but today it provides extensive support for group risk management decisions, participating in the majority of insurance placements. “There is no risk financing decision without the involvement of the captive”, he said.

At Umicore, a global materials technology and recycling group, its captive has allowed the company to “regain the confidence” of the insurance market and grow from simply buying insurance to designing its own risk transfer strategy.

“The real shift for us is that the captive now allows us to shape our own risk appetite rather than depend on the market’s willingness to provide insurance”, noted Bart Smets, Umicore Group’s Head of Risk and Insurance.

Reinsurance captives have also moved along a similar trajectory, Denis Waerseggers, Head of Group Insurance and Risk Financing at the Swiss multinational building materials company, Holcim, commented.

Its reinsurance captive, Atlantic Re, serves as a centralized vehicle that pools diverse lines of risk, combining corporate property risk with international employee, medical and life insurance, he said. This has helped both to reduce balance sheet volatility as well as improving solvency.

“Today, the landscape looks different”, he reflected. “The combination of exponential data growth, better risk understanding, active prevention policies and new regulatory frameworks has transformed most reinsurance captives from passive risk-retention tools into agile, strategic profit centers.”

What drives success?

Crucially, however, captives do not become strategic simply by existing, argued Zurich’s Scherzinger. In many cases, the process is intentional, implementing structural changes that connect it to decision-making, risk appetite and wider business priorities.

For example, BP’s captive, Jupiter, was initially a tactical tool providing cover for risks required by contractual or legislative requirements. Over the past few years, however, the company has purposefully expanded its remit, enabling it to capture a more extensive pool of risk data and provide insights that support strategic decision-making, said Tracey Williams, Head of Captive Solutions/Risk and Insurance at BP.

For aerospace manufacturer Bombardier, the decision to expand into employee benefits marked the key turning point in the strategic evolution of its captive.

“The senior management team then realized that the captive was much more than an insurance tool”, said Daniel Desjardins, Bombardier’s Senior Director of Global Risk Management and Insurance: “From that point on we had much more latitude to drive strategic risk management.”

Turning uncertainty into advantage: what role for captives?

Today’s risk environment is more complex, interconnected, and unpredictable than it was ten years ago. Continued geopolitical instability, supply chain disruptions and rapid technological advancements are influencing risk environments across sectors and regions. What has changed is not only the volume of risks, but also how they interact and escalate.

The captive industry can help organizations navigate uncertainty, and today’s risk landscape has provided fertile ground for captives to demonstrate their broader value to parent companies. They can help enhance control and stability on the balance sheet and turn uncertainty into a source of competitive advantage.

“Our captive has taught us to look differently at risks and their interconnectivity,” said Umicore’s Bart Smets. It has encouraged the organization to approach risk decisions like an insurer, he added, bringing in a range of stakeholders to diversify discussions and be creative in their response to new or niche situations.

“The captive has given us more control in a world where uncertainty is increasing, and market capacity is not always guaranteed”, he added.

With the global risk landscape changing at rapid pace, captive managers that are part of broader business discussions and sit close to the heart of decision-making are particularly well-placed to add value, the panel agreed.

For Desjardins, for example, sitting on the Finance Leadership Team has been instrumental. “Being at the table gives me the opportunity to understand some of the challenges they are facing and possibly look at ways where the captive could play a role in their day-to-day operation”, he reflected.

The accelerating pace of change is prompting organizations to reassess how they balance risk transfer and risk retention, while also exploring new ways to maximize the strategic value of their captives.

Although the decision-making process varies according to each organization’s business model, there is broad consensus on the importance of regular reviews. These should be underpinned by actuarial analysis to assess capital efficiency, optimize retention strategies, and ensure the captive remains adequately capitalized and solvent, the panel discussed.

Overcoming internal challenges

While captives have come far in their journey from alternative to mainstream, it remains a “constant internal challenge” to establish influence, understanding and obtaining buy-ins across the broader business environment, the panel agreed.

And this matters: “A captive cannot be a strategic tool without the highest commitment and understanding from its management”, according to Holcim’s Waerseggers.

There is often an “internal disconnect” between corporate finance objectives and the added value brought by the captive, he added. A captive manager must therefore be skilled in the art of translation – the ability to frame captive discussions in a language that resonates with senior executives.

“Many still don’t understand how and why a captive is needed, we need to simplify the message, especially to the top management”, agreed Zucchi.

Taking captives to the next level

Today, captives do not simply exist to finance risk but to facilitate taking better risk. As Zurich’s Scherzinger summed up, “At their best, they help organizations understand their risks more deeply, make better decisions, use capital more effectively and turn uncertainty into strategy.”

For companies seeking to elevate their captive and accelerate the shift from a tactical to a strategic role, there are three critical success factors, noted Smets.

First, integrate the captive into the broader enterprise risk management framework and risk appetite discussions. Second, use it as a vehicle for data, insights and prevention – not just a mechanism of funding risks. Third, proactively seek executive sponsorship: achieving buy-in from the outset, including during the creation phase, is vital, he said.

And finally, be bold and don’t shy away from taking personal risks, added Desjardins. A key part of the risk manager’s role is to give the captive a voice and champion it as an integral part of the overall solution:

“Come out in the light and don’t be afraid to expose yourself; that’s the only way you will bring value to your organization.”

Originally published on Commercial Risk on September 8