2024 Year-end General Business Handbook

Summary

This is the Bermuda Monetary Authority's 2024 Instruction Handbook for the Capital and Solvency Return (Bermuda Solvency Capital Requirement, or BSCR, model), covering Class 4, Class 3B and Class 3A general business insurers. It explains how these insurers must calculate and report their Enhanced Capital Requirement (ECR), Target Capital Level (TCL) and Minimum Solvency Margin, and sets out the schedules, forms and supporting documents that must accompany the annual filing.

• Who must file: Every Class 4, Class 3B, Class 3A, Class E, Class D and Class C insurer, and every Insurance Group, must submit a completed capital and solvency return to the BMA on or before its filing date; this handbook specifically instructs Class 4, 3B and 3A insurers on completing the BSCR model.
• Submission method: Insurers may file electronically using the 'submit' macro embedded in the BSCR model; if not filing solely electronically, both an electronic and printed version must be forwarded to the BMA, and the return must not be altered or modified.
• Required attachments: Insurers must attach General Purpose Financial Statements (audit report, financial statements and notes) in one document, a signed Declaration of Compliance under section 15A of the Insurance Act 1978, and a Financial Condition Report as required under section 3 of the Insurance (Public Disclosure) Rules 2015.
• Declaration signatories: For Class 4 and 3B insurers, the capital and solvency return declaration must be signed and dated by two directors (one may be the CEO) and either the chief risk officer or chief financial officer; for Class 3A insurers, by two directors and the insurer's principal representative.
• Record retention: Work papers and supporting documents used to prepare the BSCR submission must be retained and made available to the BMA for examination if requested.
• 2024 catastrophe schedule transition: For the 2024 year-end, insurers must complete Schedule XA under both the 2023 and 2024 year-end methodologies, unless they obtain BMA permission (via email to RiskAnalytics@bma.bm) to use the 2024 methodology only.

The handbook also contains detailed line-by-line guidance for completing each schedule (investments, loss reserves, premiums, catastrophe risk, eligible capital, solvency, currency and concentration risk, and the Commercial Insurer Risk Assessment), along with a glossary of defined terms, but these are technical completion instructions rather than freestanding legal obligations.

Key obligations

• Class 4, Class 3B, Class 3A, Class E, Class D and Class C insurers and Insurance Groups must submit a completed capital and solvency return to the BMA on or before the insurer's filing date
• Insurers must not alter or modify the capital and solvency return template
• Insurers must attach a signed Declaration of Compliance (per section 15A of the Insurance Act 1978) and a Financial Condition Report (per section 3 of the Insurance (Public Disclosure) Rules 2015) to the return
• Class 4 and 3B insurers must have the return declaration signed by two directors (one may be the CEO) and either the chief risk officer or chief financial officer; Class 3A insurers by two directors and the principal representative
• Insurers must retain work papers and supporting documents used to prepare the BSCR submission for potential BMA examination
• For the 2024 year-end, insurers must complete Schedule XA under both the 2023 and 2024 methodologies unless BMA grants permission (via email request) to use only the 2024 methodology

Applies to

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

Deadlines

• on or before its filing date: Annual deadline for submission of the completed capital and solvency return to the BMA