Stakeholder Letter - Guidance Note - Recovery Planning Requirements (Commercial Insurers) (2026-03-20)

Summary

This is a Bermuda Monetary Authority (BMA) stakeholder letter closing out a public consultation on its Guidance Note (GN) for Recovery Planning Requirements for Bermuda Commercial Insurers. The GN explains how the BMA expects insurers to structure and populate a Recovery Plan under the Insurance (Prudential Standards) (Recovery Plan) Rules 2024, and the letter summarises stakeholder feedback and the amendments made to the finalised GN.

• Scope and trigger: Applies to Bermuda commercial insurers that fall within the Recovery Plan Rules based on factors such as total assets, total gross written premium, or being subject to enhanced supervisory monitoring; the BMA will formally notify in-scope insurers by Notice.
• Timing of plan: An insurer notified as being in scope must prepare its Recovery Plan in line with the Rules and within the timeframe set out in the BMA's Notice; the GN itself is effective as soon as it is finalised.
• Content expectations clarified: The GN clarifies expectations on proportionality by size/complexity, use of Group Recovery Plans, integration with the ERM framework, description of the insurer (including branches), trigger frameworks, recovery options, scenario analysis, testing, and the communication strategy.
• Communication and activation: Recovery Plans must set out a communication strategy for stakeholders before, during and after implementation; the Authority should be informed once a Recovery Plan is activated, and relevant Management Information System outputs relating to the plan must be made available to supervisors on request.
• Continuous improvement: Recovery Plans must include an outline schedule identifying areas for further improvement and when they will be addressed, with phased implementation across successive versions permitted.

The GN is described as a living document that the BMA will periodically review and update, and it does not prescribe a rigid process, allowing insurers flexibility proportionate to their nature, scale and complexity.

Key obligations

• In-scope insurers must prepare a Recovery Plan in accordance with the Insurance (Prudential Standards) (Recovery Plan) Rules 2024 and within the timeframe specified in the BMA's Notice to them.
• The Recovery Plan must include a communication strategy for engaging relevant stakeholders before, during and after implementation of the plan.
• The insurer must inform the BMA once its Recovery Plan is activated.
• The insurer must make relevant Management Information System outputs relating to the Recovery Plan available to supervisors upon request.
• The Recovery Plan must include an outline schedule identifying areas for further improvement and the timeline for addressing them.
• An insurer wishing to rely on a Group Recovery Plan must make a written application to the BMA for approval, and the plan must still meet the requirements of the Rules.
• The Recovery Plan must be understandable on a standalone basis, including coverage of any overseas branches forming part of the BMA-licensed insurer.

Applies to

Bermuda commercial insurers, insurance groups for which the BMA serves as Group Supervisor, (re)insurers licensed by the BMA within specified classes

Deadlines

• as soon as finalised: The Guidance Note takes effect as soon as it is finalised.
• within the timeframe specified in the Notice: An insurer notified by the BMA that it is within scope of the Recovery Plan Rules must produce its Recovery Plan within the timeframe set out in that Notice.