Encik Jaffree Ismail, and Encik Nor Rashidi
Board of Directors, Labuan IBFC Inc.,
Mr Ben Quah,
Chief Executive Officer, Labuan IBFC Inc Sdn Bhd,
Ms. Annie Undikai, Chairwoman,
Labuan International Insurance Association (LIIA),
Fellow regulators from Hong Kong and Singapore,
Distinguished speakers and panellists,
Dato’-Dato' and friends from overseas, Distinguish Guests,
Members of the Media,
Assalamualaikum and a very good Morning to all.
1. It is a great pleasure to join you this morning at the 8th Asian Captive Conference (ACC) 2026. This may be my first time attending the Conference, but the energy in this room is unmistakable. It reflects not only the growing relevance of captive insurance but also the strength of the regulatory and business community driving it forward.
2. Today brings together regulators, captive owners, insurers, and risk practitioners - all gathered around a common purpose. This is important because the risks confronting businesses today do not operate in silos — and neither can our responses. Innovation requires collaboration, shared knowledge; and managing increasingly complex risks require us to think beyond traditional solutions. If there is one thought that I would like to highlight at the outset, it is this:
resilience can no longer be built in isolation. And to understand why, we need only look at the dynamic world around us.
3. Every generation believes it is living through unprecedented change. But what defines our time is not simply the number of risks we face — it is how deeply interconnected they have become. Geopolitical tensions, cyber threats, technological disruption, climate events and economic uncertainty increasingly collide and amplify one another.
Volatility is no longer the exception; it is the operating reality. This brings real meaning to this year’s theme, “Captives in a Volatile World: Managing Emerging and Complex Risks.” The 2024 CrowdStrike outage is a powerful example: one technology incident triggered disruptions across industries and borders within hours. It reminds us that today’s risks rarely travel alone —
they are interconnected, fast-moving and increasingly difficult to predict.
4. And the risks are not only coming from outside.
Changes from within are moving just as fast. AI, automation and new business models, are reshaping how companies operate — creating new opportunities and vulnerabilities. Nowhere is this more evident than in Asia. Our economies are growing, digitalising and becoming more interconnected. Businesses now span markets, supply chains, platforms and jurisdictions.
The upside is enormous.
But so is the exposure. A disruption in one part of the system can quickly ripple across borders, businesses and financial markets.
5. The challenge is even sharper in Southeast Asia where natural disasters, climate risks, and cyber threats continue to widen the protection gap. This leaves many organisations underinsured or worse - uninsured. The numbers tell the story. Since 1980, nearly 90% of Asia-Pacific’s USD2.4 trillion in disaster losses were uninsured. And in 2024 alone, more than half of the USD318 billion in global catastrophe losses remain uninsured. The message is clear:
risks are growing faster than traditional protection can keep pace.
6. This protection gap widens further with emerging risks - from cyber and technology failures to supply chain disruptions and climate transition. These risks are harder to predict, price and insure. As coverage tightens and insurance costs rise, risk financing is no longer simply an insurance decision; it is a boardroom priority. The question is shifting from
"How much insurance should we buy?" to "How do we build resilience when sheer insurance is no longer sufficient?".
Captives as Strategic Infrastructure for ResilienceLadies and Gentlemen,
7. This brings us to a broader view of resilience. It is no longer simply about transferring risk, but owning it strategically – knowing what to prevent, what to mitigate, what to transfer and importantly, what to retain. This requires the right mix of business continuity, commercial insurance and alternative risk financing. And it is precisely here that captives are finding a more strategic role – turning risk retention into a tool for resilience.
8. Captive insurance puts strategic ownership into action. They give organisations greater control over how risks are covered, retained and financed — particularly where traditional insurance is limited, excluded or simply uneconomical. More importantly, captives connect risk and claims experience directly to prevention, mitigation and business decisions.
In that sense, a captive is more than an insurance vehicle; it becomes a strategic tool for better risk management and stronger resilience. 9. And as risks evolve, captives are evolving in tandem. Captive roles now extend well beyond traditional property and liability risks – transcending into cyber, employee benefits, climate-related risks and other emerging exposures. At the same time, innovative structures such as Protected Cell Companies (PCCs), rent-a-captives and group captives are making these solutions more accessible, flexible and scalable – opening the captive space to a much wider range of businesses.
Why Labuan IBFC Is Relevant to Asia’s Captive Needs10. This evolution has also shaped Labuan's own captive journey. As the risk financing needs of Asian businesses have grown more sophisticated, so has our ecosystem. Today, Labuan offers far more than a captive licence. It brings together captives, insurers and reinsurers, managers, brokers and professional service providers within one jurisdiction - an
integrated ecosystem within Labuan IBFC that supports captive value chain, from risk financing and management; to reinsurance and beyond.11. Labuan IBFC’s strengths also lies in its location in the heart of Asia – regional in reach yet internationally connected. It gives Asian risk owners seamless access to specialised expertise, global reinsurance markets and Shariah-compliant solutions. Combined by a progressive regulatory framework, this has positioned Labuan IBFC as one of Asia’s established domiciles for captive risk financing.
12. And this is more than mere statements. The statistics speaks for themselves on Labuan’s strong proposition for captives and it is reflected in its insurance market’s rapid growth. Let me put that into perspective:
- First, scale. In 2025, Labuan IBFC was home to 232 insurers and insurance intermediaries - a growing community that continues to deepen the market’s capabilities.
- Second, market strength. Gross premiums and takaful contributions reached approximately USD2 billion, with reinsurance accounting for around 58% - underscoring Labuan's growing role as regional platform for risk transfer and intermediation.
- Third, our Asian footprint. Nearly three-quarters of industry's premiums were sourced from Asia-Pacific, reinforcing where Labuan's natural market and opportunities lie.
- And importantly, our international reach. More than half of the overall insurance portfolio come from beyond Malaysia. Labuan IBFC is therefore not merely serving the domestic market - It is increasingly facilitating business across Asia underwrite, pool and transfer their risks globally.
13. The Labuan captive story is equally compelling — growing not only in size, but also in sophistication in the recent years:
- In 2025, captive premiums grew by 7.2% to approximately USD726 million, representing more than one-third of the Labuan insurance market.
- We welcomed 10 new captive entrants, including seven PCC cells - reflecting growing interest in more flexible captive structures.
- Most strikingly, the number of PCC cells nearly tripled in just three years - from 13 in 2022 to 36 in 2025. By the second quarter of 2026, Labuan IBFC had reached 71 captives – a strong signal of continued market confidence.
14. Over the years, Labuan captive’s progress is also gaining recognition beyond our shores. Industry rankings now place Labuan IBFC amongst Asia’s leading captive domiciles with a growing presence globally:
- In 2024, Labuan was ranked the second-largest captive hub in Asia and 22nd among 69 captive domiciles worldwide by Business Insurance publication.
- Industry assessments have also shown that Labuan accounted for approximately one-quarter of captives established across Asia and the MENA region during the assessment period.
For us, these rankings are not simply about numbers. They are a useful recognition of how far the Labuan captive market has come — and the potential that still lies ahead.
15.
This growth has been supported by modern captive regulations that continue to evolve with the market. Under the Labuan IBFC Strategic Roadmap 2022–2026, we broadened the insurable risks, introduced the External Rent-A-Captive structure, strengthened the PCC framework, and advanced the captive takaful segment. The objective is simple: give businesses greater flexibility to manage risk financing, while ensuring captives remain well capitalised, well governed and responsibly managed. In short, enabling captive innovation
without compromising financial resilience and regulatory credibility.16. Looking ahead, the next frontier for captives will increasingly be digital. Data, analytics and AI are opening new possibilities - from smarter underwriting, and real-time risk monitoring to predictive analysis, faster claims processing and better loss prevention. Labuan IBFC is preparing for this shift – In fact, Labuan FSA has introduced the
Handbook on Captain-Tech and TakaCapt Tech Innovations in Labuan IBFC, providing practical pathways for captives to embrace technology within clear regulatory guardrails. We are also looking at appropriately
governed digital-currency-denominated insurance and takaful, beginning with approved stablecoins. On this, further developments are underway to facilitate digital-based premiums and claims settlement.
The principle remains the same: embrace innovation, but with the governance and safeguards that preserve trust.17. Another area where Labuan IBFC brings something distinctive is Islamic risk financing. Building on our established Islamic finance ecosystem, we continue to expand Shariah-compliant captive solutions. The forthcoming
MADANI Captive Framework, together with the modernisation of
captive takaful framework will open new pathways for a broad range of businesses to participate. It is about widening access, encouraging innovation and giving businesses more choice in how they manage and finance risk.
Ladies and Gentlemen,
18.
This is particularly relevant in Asia, where risks increasingly cross borders. Labuan IBFC serves as a regional connector - bringing together Asian risk owners, international insurers, reinsurers, and global risk capital. As new exposures emerge from cyber and AI to climate, supply chain and energy-transition, captives can play even greater role. But the objective is not to place out every risk into one captive bucket. Captives should complement, not replace the commercial insurance. With sound governance, prudent capital and effective risk management, captives can become a powerful tool for building resilience across Asia. Ultimately, the future of Labuan captives is not simply about creating insurance vehicles but building a more connected and innovative risk-financing ecosystem for Asia’s increasingly complex risks.
19. Looking ahead, our ambition is clear - to position Labuan IBFC as Asia's leading captive and risk financing centre—gelling together innovation, Islamic finance, technology and global connectivity. Captives will remain a strategic pillar u
nder the upcoming Labuan IBFC Strategic Roadmap 2027–2031, anchored around these priorities:
a)
Grow the Market — broaden captive adoption across ASEAN and Asia;
b)
Drive Innovation — advance digital capabilities and future-ready solutions to cater for emerging risk demands;
c)
Build Capability and Connectivity — expand risk specialist talent and deepen reinsurance linkages between key markets; and
d)
Keep Regulation Fit-for-Purpose - maintain proportionate, responsive regulatory and supervisory approach to captive innovation.
ConclusionLadies and Gentlemen,
20. In a world where uncertainty has become the norm, resilience will be the advantage that sets organisations apart. We may not be able to eliminate volatility, but we can be better prepared for it.
Volatility may be unavoidable - but vulnerability does not have to be. The choices we make today will determine how resilient we are tomorrow. And perhaps that is what captives are ultimately about:
not predicting every storm but making sure we are better prepared when one arrives.
21. Labuan IBFC stands ready to work alongside businesses across Asia to build that resilience and prepare for the shifting risks of tomorrow. But resilience is not built by structures and solutions alone.
It also requires an industry that is more inclusive, innovative and sustainable – one that embraces diverse perspectives, develops new solutions to address evolving risks, and creates lasting value for businesses, communities and the wider economy.
22. Against this broader ambition, I welcome a new initiative by the LIIA -
the Women in Captive Insurance Initiative - which seeks to promote greater diversity, inclusion, leadership development, and professional opportunities for women within the captive insurance and broader insurance industry.
23. Labuan FSA supports initiatives that widen access to opportunities and foster diverse perspectives - which aligned with our efforts to promote the Social and Governance (S&G) aspects of ESG across the industry. I commend LIIA for this initiative and we look forward to seeing the wider Labuan IBFC industry community come together to give it a strong Labuan IBFC identity. As Labuan FSA, alongside the four industry associations, is part of “Labuan IBFC For ESG” (LiFE) Working Group, we see this as a meaningful participation for the industry to work together towards a shared ESG and sustainability agenda, and supporting the pledge. This will ensure that the pledge reflects the aspirations and commitment of the Labuan IBFC community, while encouraging greater collaboration across the industry in areas of inclusion, innovation and sustainable development.
24. On that note, my sincere appreciation to the organisers; and to all of you for joining us today. May today’s Conference bring fresh perspectives, meaningful conversations, new partnerships - and perhaps a few answers to new risks we have yet to imagine.
With that, it is my pleasure to declare the 8th Asian Captive Conference 2026 officially open.
Thank you.
