Notice - Compliance with International Sanctions and Subsequent Events Disclosure for Limited Purpose Insurers, Intermediaries, Collateralized Insurers and Class IIGB Insurers (2022-04-19)

Summary

This BMA notice reminds limited purpose insurers, intermediaries, collateralized insurers and Class IIGB insurers (collectively Registrants) of their obligations to comply with international sanctions and to disclose subsequent events relating to the Russian Federation and Ukraine crisis in their financial statements and annual filings.

• Sanctions compliance: Registrants must conduct business prudently, which includes complying with all applicable laws, including the International Sanctions Regulations 2013 and additional sanctions imposed against Russia and Belarus. Boards of directors must ensure processes and internal controls are in place to manage this compliance risk.
• Annual filing attestation: As part of annual filings, registrants must confirm compliance with the minimum criteria for registration under the Insurance Act 1978, including the scope of sanctions compliance described above.
• Schedule of Compliance: Limited purpose insurers, intermediaries, collateralized insurers and Class IIGB insurers must report exposure to international sanctions on the Schedule of Compliance with Suspicious Activity Reports and Sanctions enclosed with the annual filing; limited purpose insurers must also confirm adherence specifically regarding the Russia/Ukraine events.
• Subsequent events disclosure: Registrants must disclose in the notes to their GAAP and/or Statutory Financial Statements any material subsequent events between year end and board approval relating to the Russia/Ukraine situation, where not in the ordinary course of business.
• Catch up filings for pre 30 April 2022 filers: Limited purpose insurers who filed 2021 E-SFR filings before 30 April 2022 without this disclosure must prepare and submit a summary impact assessment via ESFRApplications@bma.bm; Class IIGB insurers and collateralized insurers in the same position must submit via RiskAnalytics@bma.bm.
• Intermediary notification: Intermediaries must notify the Authority by email to RiskAnalytics@bma.bm of any subsequent event outside the ordinary course of business arising from the Russia/Ukraine events.

Key obligations

• Boards of directors of Registrants must ensure processes and internal controls are in place to manage sanctions compliance risk
• Registrants must confirm in annual filings compliance with the minimum criteria for registration, including the International Sanctions Regulations 2013 and Russia/Belarus sanctions
• Limited purpose insurers, intermediaries, collateralized insurers and Class IIGB insurers must complete the Schedule of Compliance with Suspicious Activity Reports and Sanctions with their annual filing
• Limited purpose insurers must confirm adherence specifically regarding the Russia/Ukraine events in the schedule amendment
• Registrants must include a subsequent events note in GAAP and/or Statutory Financial Statements disclosing material impacts from the Russia/Ukraine events
• Limited purpose insurers who filed 2021 E-SFR filings before 30 April 2022 without the subsequent events disclosure must prepare and file a summary impact assessment via ESFRApplications@bma.bm
• Class IIGB insurers and collateralized insurers who filed 2021 annual regulatory filings before 30 April 2022 without the subsequent events disclosure must prepare and file a summary impact assessment via RiskAnalytics@bma.bm
• Intermediaries must notify the Authority via RiskAnalytics@bma.bm of any qualifying subsequent event arising from the Russia/Ukraine events

Applies to

Limited purpose insurers (Classes 1, 2, 3, A, B and Special Purpose Insurers), Intermediaries (agents, brokers and managers), Collateralized insurers, Class IIGB insurers

Deadlines

• prior to 30 April 2022: Limited purpose insurers, Class IIGB insurers and collateralized insurers who filed their 2021 annual filings (E-SFR or annual regulatory filings) before this date without including the subsequent events disclosure must prepare and submit a summary impact assessment to the Authority