Consultation Paper - Reporting Material Change for Groups by Designated Insurers (2013-06-05)

Summary

This is a Bermuda Monetary Authority consultation paper seeking industry views on proposed amendments to the Insurance Act 1978 concerning how designated insurers report material changes made by members of an insurance group for which the Authority acts as group supervisor. The paper explains the current pre-approval regime, the rationale for changing it, and attaches a draft bill (Insurance Amendment Act 2013) implementing the proposed changes.

• Current regime: Under section 30JB, a designated insurer must seek the Authority's prior approval before a group member effects a material change, with the Authority having 14 days to object once notified.
• Equivalent jurisdiction exception (current): If the group member is regulated by a competent authority in an equivalent jurisdiction, the designated insurer need only notify the Authority in writing within 90 days after the change takes effect.
• Proposed change: Remove the requirement for prior approval; instead require notification after the material change has taken effect, replacing the 90 day notice period with a shortened 30 day notice period.
• Other proposed amendment: Amend the interpretation of competent authority in section 27A by replacing the word national with regulatory.
• Consultation deadline: Comments on the proposals were requested to be sent to policy@bma.bm no later than Friday, 14th June 2013.
• Draft bill provisions: The attached draft Insurance Amendment Act No. 1 2013 would amend sections 27A, 30JB and 30JC of the Insurance Act 1978, with a proposed commencement date of 1st August 2013.

As a consultation paper, this document itself imposes no binding obligations on insurers; it invites feedback on proposed legislative changes and reproduces the draft bill text and explanatory memorandum for review.

Applies to

designated insurers, insurance groups for which the Authority is group supervisor

Deadlines

• Friday, 14th June, 2013: Deadline for industry and interested parties to submit comments on the consultation proposals to policy@bma.bm
• 1st August 2013: Proposed commencement date for the draft Insurance Amendment Act No. 1 2013, if enacted