What is the state of the Cook Islands captive industry?
The Cook Islands recently created a captive insurance industry, beginning with legislation enacted in 2013. In 2015, the Cook Islands licensed its first captive insurer, and the 2016 outlook expects to see an increase in licences.
What makes the Cook Islands an attractive domicile?
The Cook Islands is a well-established financial centre in the heart of the South Pacific. It is well known for implementing its innovative trust legislation in the early 1980s, which led to the modern asset protection trust, and which other jurisdictions have pulled from in an attempt to enhance their own financial service offerings.
The jurisdiction is able to combine the confidence of trusted service providers located in the Cook Islands with renowned insurance management services offered by multinational insurance companies to tailor a captive insurance structure to a client’s circumstances. As the Cook Islands are situated between Asia and the US, they gain the benefit of time zones, but they’re also distinctively close to New Zealand and Australia.
The jurisdiction is well regulated with positive compliance ratings with the Organisation for Economic Co-operation and Development and Asia Pacific Group (APG). It is an independent country that is English-speaking, and was founded on common law, with a judiciary overseen by highly qualified New Zealand judges.
What is new for the Cook Islands in terms of regulations, and is there anything on the horizon?
The Cook Islands recently had a successful phase-two peer review from the Global Forum. We are also expecting an APG review in 2017, which is anticipated to be just as positive as the last review, and the Cook Islands has committed to implement the Common Reporting Standards by 2018.
What are your predictions for 2016? Do you think the captive insurance industry will grow in the Cook Islands?
Most definitely. As a new product for the Cook Islands, it has no place to go but up.
There has definitely been a lot of interest shown towards this ‘new’ industry, with some prospective clients already expressing that they are keen.
What is your strategy to increase interest in the Cook Islands captive insurance industry?
The Cook Islands financial services industry has, over the last several decades, traditionally focused on the US market, with the Cook Islands international trusts having become the golden standard in offshore asset protection.
The Cook Islands has also tapped into the Asian market over the last decade and will continue to do so, especially with the increasing number of high net worth clients.
For captive insurance the Cook Islands’ initial focus is on the New Zealand and Australian markets, given the close relationship and proximity. But this product will also be suitable for clients from our Asian and American markets.