The number of Marsh-managed captive insurers writing cyber cover surged 19% last year as companies sought innovative ways to manage risk, according to the global broker.

Since 2012, cyber-liability programs in captives have growth by 210%, and the expansion is likely to continue, Marsh says in its 10th annual in-depth report on captives.

The number of captives globally grew to more than 7000 last year, up from 5000 in 2006.

Increasing numbers are based in Europe and Asia, with Sweden, Guernsey, Singapore, Malta and Cayman among the top growth areas outside the US.

The use of Marsh-managed captives for employee benefits also recorded a double-digit increase last year, as the insurance vehicles gained traction outside traditional property and casualty programs.

Marsh says technological disruption and global economic and political uncertainty are exposing companies to unfamiliar and sometimes unquantifiable risks.

“In parallel with these macro-trends, more companies than ever see captive utilisation as being at the core of innovative risk management strategies,” Marsh Captive Solutions President Nick Durant says.

“As captives are used to address a growing range of risks, they are also helping clients break down operational silos between risk management, human resources and business development.”

Potential advantages for cyber include filling gaps in standard policy language, securing coverage for emerging and unique risks, and consolidating programs across operating companies, the report says.

Financial services, healthcare and manufacturing continue to dominate captive use, but they are also found in sectors including agriculture and fisheries, automotive, education, communications, media, and technology and the life sciences.

Marsh says companies began forming their own insurance company subsidiaries in the 1960s, paving the way for steady growth in captive numbers regardless of catastrophic events or insurance market conditions.