Insurance (Technical Standards) (Class IIGB Insurer) (Statements, Returns and Capital Solvency) Rules 2020 - Schedules

Summary

This document contains the prescribed Schedules to Bermuda's Insurance (Technical Standards) (Class IIGB Insurer) (Statements, Returns and Capital Solvency) Rules 2020. Class IIGB insurers are a category of Bermuda insurer engaged in digital asset (crypto) related insurance business. The Schedules set out the exact statutory financial statement forms, notes to accounts, and solvency margin calculation methodology that these insurers must use when preparing and filing their regulatory returns with the Bermuda Monetary Authority.

• Form 1SFS: Statutory Balance Sheet, requiring assets and liabilities to be reported separately as denominated in fiat currency versus digital assets, on both unconsolidated and consolidated bases, including specific line items for digital assets, digital asset issuance liabilities and receivables from digital asset business.
• Form 2SFS: Statutory Statement of Income, again split between fiat and digital asset denominated amounts, unconsolidated and consolidated, covering underwriting income and expenses, combined operating expenses, taxes and net income.
• Form 8SFS: Statutory Statement of Capital and Surplus, detailing capital stock, contributed surplus and other capital instruments in fiat and digital asset terms.
• Notes to financial statements: Required disclosures include related party transactions (including director/officer loans outside the ordinary course of business), material contingencies and commitments, subsequent events, and any other information needed so the statements are not misleading.
• Schedule IV - Minimum Margin of Solvency: Prescribes the method for calculating the four components (Figures A, B, C and D) used under Rule 10 to determine a Class IIGB insurer's minimum margin of solvency, including a fixed Figure A of $120,000, a premium-based Figure B formula (20% of net premiums up to $6,000,000, or $1,200,000 plus 15% of the excess above that threshold), a 15% Figure C based on specified balance sheet lines, and Figure D as 25% of the insurer's ECR.

Because this excerpt covers only the Schedules (forms and solvency formula), the substantive filing deadlines, frequency of returns and other obligations are set out in the main body of the 2020 Rules rather than in this document itself.

Key obligations

• Class IIGB insurers must prepare their statutory balance sheet using Form 1SFS, separately reporting amounts denominated in fiat currency and in digital assets, on both unconsolidated and consolidated bases.
• Class IIGB insurers must prepare their statutory statement of income using Form 2SFS, split between fiat and digital asset denominated figures.
• Class IIGB insurers must prepare a statutory statement of capital and surplus using Form 8SFS.
• Class IIGB insurers must disclose related party transactions, including details of relationships, transaction amounts, and any non-ordinary-course loans to directors or officers.
• Class IIGB insurers must disclose material contingencies, commitments and subsequent events affecting their financial statements.
• Class IIGB insurers must calculate their minimum margin of solvency under Rule 10 using the prescribed Figures A, B, C and D methodology in Schedule IV.

Applies to

Class IIGB insurers