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New captive owners continued to gravitate toward onshore domiciles in the U.S. and European Union in 2012. However, the market is not seeing a large number of existing offshore captives re-domesticating to onshore jurisdictions, Marsh found in its annual captive benchmarking report.

The report, Discovering Opportunity in the Shifting Captive Landscape, was based on the activities of 886 captive insurance companies — primarily single-parent captives — managed by Marsh. It found that at the end of 2012, 55 percent of companies had onshore captives versus 45 percent domiciled in offshore locations. This compared to 52 percent and 48 percent respectively, in 2011 and varied significantly from the 1991 to 2000 period where 35 percent of new captives formed onshore versus 65 percent offshore. The onshore movement could be attributed to a number of factors including travel cost savings, changing insurance regulations, insurability of certain coverages, new onshore jurisdictions, and potential premium tax savings, according to Marsh.

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