Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Amendment Rules 2022

Summary

This is a BMA consultation notice proposing amendments to the Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Rules 2011. The Authority is seeking comments before finalising two changes: a new risk exposure reporting schedule and a new quarterly financial return requirement. The amendments are proposed to take effect on 1 July 2022, subject to the consultation outcome.

• New Schedule of Risk Exposure: A new Schedule IV(F) would require Class D and E insurers to report underwriting activity broken down by the geographic location of the business underwritten (by country, covering mortality, longevity, disability, group, variable annuity and other product reserves, plus claims and benefits paid). A parallel new Part IVF under Schedule XIII would impose an equivalent requirement on Class C insurers.
• New quarterly financial return: Class D and E insurers that are not part of a group for which the BMA is group supervisor would be required to prepare and file quarterly unaudited financial statements (balance sheet and income statement), details of material intra-group transactions and risk concentrations, ECR ratio, Commercial Insurer Solvency Self-Assessment status, and bond holdings by BSCR rating.
• Possible exemption: The BMA may exempt or modify these filing requirements for a Class D or E insurer where equivalent information is already filed with, or obtainable from, the insurer's group supervisor.
• Consultation process: Comments on the proposed Rules were invited by 16 January 2022, to be submitted to riskanalytics@bma.bm; the new schedules referenced (Schedule IVF and Part IVF) are to be published separately on the BMA website.

As a draft consultation document, these Rules were not yet legally binding at the time of publication; readers should confirm whether a final version has since been adopted before relying on the specific filing dates or requirements described.

Key obligations

• Proposed: Class D and E insurers not part of a group for which BMA is group supervisor would be required to file quarterly financial returns on or before the last day of May, August and November each year.
• Proposed: Class D and E insurers would be required to complete and submit a new Schedule of Risk Exposure (Schedule IVF) showing underwriting activity by location.
• Proposed: Class C insurers would be required to complete an equivalent Schedule of Risk Exposure (Part IVF) under Schedule XIII.
• Proposed: quarterly returns must include intra-group transaction and risk concentration details, ECR ratio, Commercial Insurer Solvency Self-Assessment status, and bond holdings by BSCR rating.
• Interested parties were invited to submit comments on the proposed amendments to riskanalytics@bma.bm by 16 January 2022.

Applies to

Class C insurers, Class D insurers, Class E insurers

Deadlines

• 16 January 2022: Deadline for submitting comments on the proposed Amendment Rules to riskanalytics@bma.bm.
• 1 July 2022: Proposed effective date for the amendments, including the new risk exposure schedule and quarterly financial return requirement.
• last day of May, August and November of every year: Proposed recurring deadline for Class D and E insurers (not group-supervised by BMA) to file quarterly financial returns.

Related documents

• This document amends Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Rules 2011