Q4: ARE THERE IMPORTANT REGULATORY DEVELOPMENTS ON BERMUDA THAT MIGHT SHAPE THE MARKET?
“It is a cutting-edge move that will help lead the industry.”
Adderley: The new Bermuda collateral insurer classification, which is a hybrid between a commercial reinsurance vehicle and a special purpose insurer, will encourage people to come to Bermuda becomes it provides significant flexibility, and helps promote a more innovative marketplace. It is a cutting-edge move that will help lead the industry.
What the BMA has done around insurtech will greatly help the Bermuda marketplace, especially with working from home and how people are doing things differently. It’s a very exciting time.
Huff: We will shortly see Bermuda secure credit for reinsurance in the US as states pass the updated NAIC models. What’s the benefit for Bermuda? We will have preferential designation as a reciprocal jurisdiction, which means we’ll see regulatory collateral go to zero in the US for Bermuda reinsurers. It will be a great opportunity for Bermuda.
You should also look out for a modernisation of Solvency II in the EU which will be very important to Bermuda because of our equivalence.
Finally I would raise that personal privacy protection law in the US, which follows the EU General Data Protection Regulation, is an area to watch.
“There are a number of standards that will impact many companies.”
Brown: When you look from a pure accounting perspective, there are a number of standards that will impact many companies. IFRS 17 for those companies reporting under IFRS and long duration targeted improvements for the life companies that report under US GAAP have effective dates in a few short years, and these will require significant effort and system solutions from many companies.
There are also new cyber and privacy-related regulations that companies are dealing with and then we’re seeing economic substance, Pillar 2 and other items from the OECD or EU, and increased regulatory requirements overall.
Image courtesy of Shutterstock / Lucky-photographe