Guernsey Finance
Dominic Wheatley of Guernsey Finance reveals what attendees can expect from this year’s Guernsey Insurance Forum
How has 2018 been for the Guernsey captive market and Guernsey finance?
The captive industry is quite a regionalised industry, and our dominant regions of business—Europe and the UK—are relatively mature markets. By and large, we haven’t seen a huge amount of new traditional captive business, but there has been some new business, as there always is.
We are very happy that over half of the new business that has come up within our traditional market over the past year has come into Guernsey. It will be nice to see more economic stability and to return to that market, which should enable people to commit more to the type of long-term financing structures that captives are. We appreciate that with Brexit and other sources of uncertainty, it is difficult for corporates to make those types of long-term plans.
Southeast Asian economies are growing fast, with distinctively more stability in some senses than the traditional markets that we have. We have seen a significant number of captives (three) come to us from China alone. There are some really good signs there of the emergence of a major new market, and our position is well established in that market.
Is there anything in particular that you are working on at the moment in the captive space?
A couple of things—obviously there’s Brexit, there are some interesting technical challenges there. The other area, of course, is the issue of substance and the investigation by the EU. Our captive industry has been substance-based for a very long time because the UK tax authorities have always demanded that the business done in Guernsey was done at arm’s length and that the necessary governance would be on the island to conduct that business.
The reason I myself came to Guernsey as an experienced London underwriter at the time was to provide substance on the underwriting side, to this day, we have a very high number of qualified insurance personnel here, probably more than most of our competitive jurisdictions, frankly. Those two issues—substance and Brexit—will be the key themes at our conference in October. Our keynote speaker is Karl Hennessy, CEO of Carrier Solutions at Aon. It will be good to hear from someone with his profile and standing in the international space on the challenges around Brexit, and to hear the discussions among practitioners on the solutions being generated.
Is there anything attendees can expect from the conference that will be different from previous events?
We never look to run the same conference twice—our conferences are based around insurance rather than specifically captives. This year has got a very significant captive theme, and it’s likely to be a very different type of conference than last year, so hopefully, we’ll attract a slightly different audience, which is absolutely fine because we have a significantly varied industry. We are not just a captive jurisdiction, we have a reinsurance sector and do a lot of insurance-linked securities, as well as niche line insurance and a developing of our MGA presence. Guernsey is not just a captive centre, although captives are still a major part of our book of business, and we still view captives as a fantastic product.
Can you expand on the topics at this year’s conference?
Captives are still a central part of our book, and we recognise that captive owners and captive service providers are facing some very interesting issues at the moment. We feel it’s a really good time for these discussions, and with a bit of luck, October will see more clarity. I think it’s quite a good time to be having a discussion around Brexit and what it might mean to corporate risk managers, and therefore what captives can do to help with that.
In terms of substance, it’s really an opportunity to reassure our captive clients here that Guernsey is a substantial jurisdiction with real substance across a range of financial service industries, particularly inssurance, which has been very much a substance-based industry for well over 20 years. They really should be very reassured that we will provide a very strong base for their captives and will firmly be on the whitelist of the EU tax code review.
What are you personally looking forward to about the conference?
I’m most looking forward to re-engaging with some of the colleagues I haven’t seen for years. I’ve got a lot of good friends in the London insurance industry, it’s a fantastic sector. I worked in it for decades, so I’m really looking forward to catching up with some of my old contacts and updating my understanding of the sector, the issues clients are facing, and how the industry is responding to them.
