Potential Changes To The UK’s Employee Automatic Transfer Regime

Executive Summary

• What’s new: On 14 July 2026, the UK’s PRA and FCA published detailed proposals for a tailored UK captive insurance regime for consultation. 
• Why it matters: The proposals would create a bespoke, proportionate and internationally competitive framework, separate from Solvency UK, designed to make the UK a more attractive domicile for captive insurers. Whether the regime succeeds in attracting captive formations to the UK will depend on a number of factors, including the PRA’s supervisory approach in practice and, critically, the UK’s tax treatment of captives relative to established domiciles such as Bermuda and the Cayman Islands — a factor the PRA itself acknowledges falls outside its remit.