Insurance (Prudential Standards) (Insurance Group Solvency Requirements) Amendment Rules 2022

Summary

This is a BMA consultation notice proposing amendments to the Insurance (Prudential Standards) (Insurance Group Solvency Requirement) Rules 2011, affecting insurance groups subject to group supervision in Bermuda. The proposed Amendment Rules would expand quarterly group reporting requirements and introduce a new risk exposure schedule. The Authority invited comments on the draft before finalising the changes.

• New Schedule IVF: Introduces a Schedule of Risk Exposure requiring insurance groups to report underwriting activity details by the location of the business underwritten, covering premiums, reserves, losses and claims by jurisdiction.
• Additional quarterly reporting: Insurance groups would need to report, on a quarterly basis, the Enhanced Capital Requirement ratio, a Group Solvency Self-Assessment, total quoted and unquoted bonds allocated by BSCR rating, and details of qualifying catastrophe events (industry insured losses of US$5 billion or more, or events prescribed by the Authority).
• Paragraph 6 and 8 amendments: Amends paragraph 6 to add Schedule IVF references and paragraph 8 to insert the new reporting items described above into the principal Rules.

As a consultation document, this notice is not yet in force; it sets out proposed changes and invites industry comment before the Rules are made final. The Authority proposed an effective date of 1 July 2022 for the amendments, subject to the consultation outcome.

Key obligations

• If adopted, insurance groups would be required to complete and submit the new Schedule IVF (Schedule of Risk Exposure) detailing underwriting activity by location on a consolidated basis
• If adopted, insurance groups would be required to additionally report quarterly on the Enhanced Capital Requirement ratio, Group Solvency Self-Assessment, bonds by BSCR rating, and catastrophe risk exposure details
• Interested parties were invited to submit comments on the proposed amendments to riskanalytics@bma.bm by 16 January 2022

Applies to

insurance groups

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 to take effect