Notice - Insurance (Eligible Capital) Amendment Rules 2016 (2016-05-09)

Summary

This is a Bermuda Monetary Authority consultation notice proposing amendments to the Insurance (Eligible Capital) Rules 2012. It sets out two technical changes to the Eligible Capital Rules and invites public comment before the changes are finalised.

• Tier 1 ancillary capital wording: Restores clarifying text in Paragraph 2(2)(a)(i) on the loss-absorbing features of Tier 1 ancillary capital that had been deleted in error.
• Risk Margin adjustment: Removes the Risk Margin (Line 18 of the Statutory Economic Balance Sheet) from the calculation of encumbered assets supporting policyholder obligations in Paragraph 2(3)(a)(ii)(A)(1), aligning reporting treatment for Class 4, 3B and 3A insurers with Class C, D and E insurers.

The Authority proposes that, if adopted, all amendments become effective from 1 January 2017. The attached draft Rules text shows the specific proposed statutory wording changes to Paragraph 2 of the principal Rules.

Key obligations

• Interested parties wishing to comment on the proposed Rules must submit comments to riskanalytics@bma.bm by 23 June 2016.

Applies to

Class 4 insurers, Class 3B insurers, Class 3A insurers, Class C insurers, Class D insurers, Class E insurers

Deadlines

• 23 June 2016: Deadline for submitting comments on the proposed Insurance (Eligible Capital) Amendment Rules 2016 to riskanalytics@bma.bm
• 1 January 2017: Proposed effective date for all amendments if adopted