Bill McCullough's three years as the top insurance regulator in the Cayman Islands coincided with tremendous growth in the sector, writes Roger Crombie.

William McCullough retired on 31 October 1999, concluding a peripatetic career in insurance at Elizabethan Square in George Town, Grand Cayman. Some join the Navy to see the world; he joined the insurance industry. His final posting was as the head of insurance supervision at the Cayman Islands Monetary Authority (CIMA) for a period of three years, during which islands' insurance market grew dramatically. During his tenure, total assets in the Cayman insurance sector increased from $6.5 billion to $11.6 billion, while annual premiums rose 60% to $3.2 billion.

At 61, Bill McCullough and his wife are heading off to Australia, where they have property. Originally from Northern Ireland, he began his insurance career in the United Kingdom with Lloyd's broker Minet, later part of the greater Aon, which sent him to manage its operations in Nigeria for three years. Like many who hit the expatriate circuit, Mr. McCullough just kept going. His Nigerian tour was followed by a move to manage Minet's interests in Malaysia, on the general side. Three years there, then a move to New Zealand.

Mr. McCullough then returned to underwriting and worked with two insurers before moving, once again, to Papua New Guinea. He was appointed managing director of the New Guinea Insurance Corporation, a state owned carrier. Having arrived in Papua a company man, Mr. McCullough emerged a regulator.Next on the agenda was Australia, with GIO, and then a post as government advisor in Bahrain, working in the regulatory system for what was supposed to be the last time before taking early retirement. The McCulloughs even went so far as to build a house north of Brisbane in Queensland, to which to retire.Bahrain licenses most of the companies in Saudi Arabia. At the end of his time in Bahrain, an opportunity arose and Mr. McCullough could not resist: three years in Saudi, with the certainty that this contract would be the last. It was not, of course. The three years in the Cayman Islands, which have just ended, followed the three years in Saudi. Only now is his destination, finally, the house in Queensland.

Like most in the Cayman insurance sector, Mr. McCullough is refreshingly frank. His interpretation of administrative oversight is “not just about having a series of questions answered,” he says. “We make sure that the company has more than a 50/50 chance of survival. We pay attention to what they intend to do, how they intend to do it and, then, the way they do it.” The “we” he uses in this context are the eight staff of the insurance section of the CIMA, most of whom have looked at life from both sides now. Gordon Rowell, the deputy head of insurance, has a background in life insurance and the team includes two analysts, a former internal auditor for Royal & SunAlliance and a former risk manager.

The two major developments on Mr. McCullough's watch have been securitised cat bonds and segregated cell companies. “We showed we can be responsive to innovation,” he says. “The law firms helped enormously. Legislation is discussed with the private sector before the draft is issued.” Here, the “we” Mr. McCullough uses is “we, the Cayman insurance industry”. “Under our legislation,” he says, switching to his governmental hat, “the managers are responsible for the compliance with the law of the companies they manage. It is self-regulation in that sense.”

He speaks openly of the image problem the Cayman Islands has accrued in some quarters, one many feel was crowned by Tom Cruise in The Firm, Hollywood's vision of corruption visited upon an entirely fictional Cayman Islands. “We are constantly fighting the credibility battle,” Mr. McCullough says, using now the voice of “we, the entire Cayman business industry”. The government has since approved a programme aimed at enhancing the islands' public image.He mentions, in the area of recent developments and trends, the formation in Cayman of Scottish Annuity & Life, recently capitalised in the Cayman Islands at $300 million, and admits: “We have two or three like that on the go,” adding: “Every so often, we find little niche markets.”

The story of the Cayman Islands' insurance sector is also, it would seem, the story of Mr. McCullough's working life. The last ten years of the latter have been a battle between the urge to get away from it all and the need to be at the centre of the action. Having worked his way around the world, will Bill McCullough make the Cayman Islands his final curtain call? Watch this space.

Roger Crombie is the editor of the Cayman Islands edition of Global Reinsurance and the Bermuda correspondent for the publication. He is also a fellow of the Institute of Chartered Accountants in England and Wales. E-mail: