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Bermuda: Law of Offshore

Insurance Law

This page was last updated on 6 August 2019.

Bermudian insurance was regulated by the Minister of Finance and registrar of companies under the Insurance Act 1978, Insurance Amendment Act 1996 and Companies Act 1981. Supervisory responsibility was transferred to the Bermuda Monetary Authority (BMA) under the Insurance Amendment Act, 2004. The legislation grants greater flexibility than that of most other jurisdictions; this partly accounts for Bermuda's success as an insurance centre. An annual audit is required, together with a solvency certificate. Annual licence fees vary depending on the class of insurer.

There are four classes under which insurers can register:

  • Class 1: Single-parent captives which do not write external business. Minimum capital and surplus is US$120,000.
  • Class 2: Multi-owner captives underwriting the risks of their owners, or single-parent or multi-owner captives writing not more than 20% of external business. Minimum capital and surplus is $250,000.
  • Class 3: Insurers and reinsurers not included in the other three classes, including reinsurers writing 3rd party business, finite reinsurers, etc. Minimum paid-up share capital is $1,000,000.
  • Class 4: insurers and reinsurers writing direct excess liability and/or property catastrophe reinsurance risks. Minimum capital and surplus is $1,000,000.

There are additional rules dealing with minimum levels of statutory and authorised capital, distinguishing between general and long-term (life) business. The solvency and liquidity requirements under the Insurance Act are found in the Insurance Returns and Solvency Regulations 1980. These require general business insurers to maintain at all times a minimum margin of solvency.

Insurers must file annual financial statements and statutory returns with the registrar of companies, audited by an approved auditor. They are subject to various other reporting and fiduciary requirements.



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