Lee Coppack: What changes have you made to the processes of company registration since becoming registrar?
Jeremy Cox: We believe that the current admissions process has provided us the benefit of being efficient as well as providing the level of scrutiny and review necessary to maintain Bermuda's position as a premier offshore insurance jurisdiction. Further, steps are being taken to utilise technology and e-commerce to enhance the efficiency of application processing.
Lee Coppack: Are there further changes underway?
Jeremy Cox: The department is mindful of the impact that the merger of capital markets with insurance markets and proliferation of e-commerce will have on the operations of insurance entities formed in Bermuda. We are cognisant of the fact that we must be prepared to adapt the vetting process, where necessary, to maintain the standard of review that presently takes place. It would appear that Bermuda is currently on pace for a banner year of incorporations, with company incorporations in general and insurance incorporations in particular running above the prior year levels.
Lee Coppack: Any other developments affecting the registration of companies generally or insurance companies in particular during the rest of the year? What trends have you noticed in insurance company registrations over the last year or so?Jeremy Cox: We are seeing increased interest in insurers conducting life and annuity business, and a slight increase in the incorporation of companies carrying on business as professional insurers and/or reinsurers. Sponsored captives are still receiving a consistent level of interest.
Lee Coppack: How likely are you to increase the publication of information about class 3 and class 4 companies?
Jeremy Cox: We currently release statistics on the underwriting activity of all Bermuda insurers, organised by class of insurer, showing gross and net premiums written, and capital and surplus amounts. Information on individual companies is not published by this department, but can generally be found in other public periodicals.
Lee Coppack: I am told that captives are increasingly registering as class 3 companies so they can handle third party business, often for customers and suppliers. How can these assureds check the quality of the security they are being offered?
Jeremy Cox: All insurers wishing to be registered in Bermuda are subject to the same scrutiny, both at the admissions stage, and on an ongoing basis. As such those captives licensed to write third party business are regulated as all Class 3 companies are regulated. Class 3 insurers are required to maintain a minimum solvency margin and capital and surplus of $1,000,000, with actual requirements based on the greater of 15% of net premiums written up to $6 million (and 15% of net premiums written over $6 million). In addition, together with the more stringent reporting deadline, Class 3 insurers must include the certification of loss reserve specialist with their annual filling.
Lee Coppack: Does the increasingly diverse character of the business plans of new (re)insurance companies in Bermuda, such as Tokio Millennium Re and Max Re, have any implications for your work and, if so, what?
Jeremy Cox: The department has been pleased to be able to attract staff with varied skills, which enhances the department's ability to review and properly regulate the various new types of insurance products and scenarios that are beginning to proliferate. In addition, we pride ourselves on the good relationship we have with the industry professionals. These relationships give us the ability to utilise not only the expertise within the department, but within Bermuda's insurance industry as a whole. The level of expertise of the membership of the Insurers' Advisory and Admissions Committees has proven invaluable in adding an additional level of scrutiny to the admissions process, and has been an additional source of information for the department.