Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Amendment (No. 2) Rules 2022

Summary

This is an amendment to the Bermuda Monetary Authority's Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Rules 2008. It expands the quarterly financial disclosure requirements for Class 4 and Class 3B insurers and adds a new Schedule IVF, the Schedule of Risk Exposure, to the underlying Rules.

• New quarterly disclosures: Paragraph 6AB is amended to require insurers to report, in addition to existing items, the ECR ratio for the financial quarter, and the total quoted and unquoted bonds allocated by BSCR rating for the financial quarter.
• Catastrophic event reporting: Insurers must also disclose details of any qualifying catastrophic event occurring during the financial quarter, defined as an event recognized by an Authority approved catastrophe modelling firm with publicly estimated industry insured losses of US$5 billion or more, or any event so determined by the Authority.
• New Schedule IVF: A new Schedule IVF, entitled Schedule of Risk Exposure, is inserted into the 2008 Rules immediately after Schedule IVE, and references to Schedule IVE in paragraph 6 are extended to include Schedule IVF.

The Rules are deemed to have come into operation on 1 July 2022, meaning the enhanced disclosure requirements apply retroactively from that date even though the amending instrument was made on 4 November 2022.

Key obligations

• Class 4 and Class 3B insurers must include the ECR ratio for the financial quarter in their quarterly disclosures under paragraph 6AB.
• Class 4 and Class 3B insurers must report total quoted and unquoted bonds allocated by BSCR rating for the financial quarter.
• Class 4 and Class 3B insurers must disclose details of any qualifying catastrophic event (industry insured losses of US$5 billion or more, or as otherwise determined by the Authority) occurring during the financial quarter.
• Class 4 and Class 3B insurers must complete and submit the new Schedule IVF (Schedule of Risk Exposure) as part of their filings under the Rules.

Applies to

Class 4 insurers, Class 3B insurers

Deadlines

• 1 July 2022: Deemed commencement date of these amendment Rules; enhanced quarterly disclosure requirements apply from this date.

Related documents

• This document is made under Insurance Act 1978
• This document amends Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Rules 2008 (BR 83/2008)