This study was commissioned by FinMark Trust to investigate the cell captive landscape in South Africa and the potential that cell captives may have in promoting insurance inclusion, through extending the reach of the microinsurance market.

Relevance of the study

Access to insurance is an important strategy for reducing poverty. The cell captive insurance vehicle may be a convenient vehicle for providing insurance related services to the lower  income market. It may also be a stepping stone for new entities wishing to enter the insurance market with the eventual goal of becoming a fully fledged insurer.

As such the object of this report is:

• to set out the cell captive insurance mechanism currently used in the long and short term insurance
  industry in South Africa;
• to report on how cell captives are being used for the provision of low cost insurance solutions to the
  low-income market;
•  to identify both risks and opportunities for the future use of cell captives in the South African
  insurance landscape;
•  to review the need for cell captive regulation and to serve as an information base to inform regulation.