Category: Captives & ART · Reviewed by Taylor Watts, Broker · New Business · Last reviewed 2026-06-05
A protected cell company (PCC) is a single legal entity divided into legally segregated cells, each of which is ring-fenced from the others such that the assets attributable to one cell may not be applied to satisfy the liabilities of another. The PCC concept was pioneered by Guernsey in the Protected Cell Companies Ordinance 1997 and has been adopted in essentially equivalent form in numerous offshore and onshore insurance domiciles.
Category: Captives and alternative risk transfer Also known as: PCC, Protected cell vehicle Established: Protected Cell Companies Ordinance 1997 (Guernsey) Related concepts: Cell captive, PCC, Rent-a-captive, Captive insurance company
A PCC consists of a “core” (the underlying corporate entity with shareholders, directors, and centralised administration) and one or more “cells” (each of which is a legal ring-fenced compartment with its own assets, liabilities, and accounting). The legal effect of cell formation is that cell creditors have recourse only to the assets attributable to that cell (and, in some structures, secondarily to the core), and not to the assets of other cells. The PCC structure is used principally in insurance and reinsurance to host multiple cell captives, sidecars or ILS structures within a single regulated vehicle.
The Guernsey Protected Cell Companies Ordinance 1997 (subsequently incorporated into the Companies (Guernsey) Law 2008) is the original legislation. The Bermuda Segregated Accounts Companies Act 2000 provides the equivalent Bermuda structure (Segregated Accounts Companies, SACs). The Cayman Companies Act SPC provisions provide Segregated Portfolio Companies (SPCs). Malta, Isle of Man, Mauritius, South Africa, US Vermont, US Delaware and others have adopted parallel statutes.
The validity of the cell ring-fencing has been considered in litigation in several jurisdictions, including in the BVI in Re Green Eagle Capital [2010], with the Privy Council in Re ICP Strategic Credit Income Fund Ltd [2014] UKPC 36 indirectly supporting the segregation principle. UK PRA and FCA recognise PCCs (typically as branch arrangements) for Solvency II/UK purposes.
A captive manager typically establishes a PCC in Guernsey or a comparable jurisdiction and offers cells to multiple corporate users. Each cell has its own captive arrangements (premiums, claims, reinsurance, capital) but shares the PCC’s regulatory authorisation, board, audit, and administrative services. This allows users to access captive infrastructure at materially lower fixed cost than a single parent captive.
Cell captive is the principal use case in insurance. Incorporated cell company (ICC) is a variant in which each cell is itself a separately incorporated company within an ICC group. Sponsored captives (where the PCC core also provides capital) and rent-a-captives (the predecessor concept without legal segregation) are related structures.
A Guernsey-domiciled PCC hosted by a major captive manager: PCC has a core capitalised at £500k plus 25 cells representing different corporate users’ captive arrangements; each cell has its own balance sheet, capital requirement, and reinsurance programme; the PCC’s annual regulated audit confirms cell-by-cell capital adequacy and the absence of cell cross-contamination.
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-05. Next review: 2026-12-05.
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