insurance

Who is caught

The Insurance Act 1978 is Bermuda's principal insurance statute, under which the Bermuda Monetary Authority (BMA) registers, classifies and supervises insurers and insurance intermediaries carrying on insurance business in or from Bermuda. Related Acts and subsidiary rules govern life insurance contracts, non-resident undertakings, the Authority's own powers, and detailed prudential and reporting standards for particular classes.

Insurers and intermediaries

• Registered insurers: General business insurers (Class 1, 2, 3, 3A, 3B, 4), Collateralized Insurers, Special Purpose Insurers, long-term business insurers (Class A, B, C, D, E) and innovative insurers (Class IGB, ILT, IIGB, IILT) must be registered and classified by the BMA before carrying on insurance business.
• Intermediaries: Insurance managers, brokers, agents, salesmen, insurance marketplace providers and innovative intermediaries must be separately registered under the Insurance Act 1978.
• Insurance groups: Insurance holding companies, designated insurers and insurance groups, including Internationally Active Insurance Groups (IAIGs), are brought within a group supervision regime where the BMA acts as group supervisor.

Other in-scope persons

• Non-resident undertakings: Under the Non-Resident Insurance Undertakings Act 1967 (1989 Revision), any manager, agent or other person conducting insurance business in Bermuda on behalf of a non-resident insurance undertaking requires a Ministerial permit; all members of the Society of Lloyd's are treated collectively as a single undertaking.
• Life insurance contracts: The Life Insurance Act 1978 governs contracts of life insurance made in Bermuda or expressed to be governed by Bermuda law, applying to insurers, policyholders and beneficiaries.
• AML/ATF regulated sector: Under the Anti-Terrorism (Financial and Other Measures) (Businesses in Regulated Sector) Order 2008, long-term insurers (not reinsurers) and insurance managers and brokers acting in connection with certain long-term business fall within the regulated sector supervised by the BMA.
• Financial institutions generally: The Bermuda Monetary Authority Act 1969 establishes the BMA and treats insurers, designated insurers, insurance groups and IAIGs as financial institutions subject to its supervisory, information-gathering and fee-setting powers.

Sources: Anti-Terrorism (Financial and Other Measures) (Businesses in Regulated Sector) Order 2008 · Bermuda Monetary Authority Act 1969 · Insurance Act 1978 · Non-Resident Insurance Undertakings Act 1967 (1989 Revision) · Life Insurance Act 1978

Key duties

Continuing obligations centre on registration, maintaining capital and solvency, and filing statutory returns and reports with the BMA. Many filings carry fixed annual deadlines, and record-keeping and notification duties run alongside them.

Registration and capital

• Registration: Insurers must be registered and classified before carrying on business, and intermediaries must be registered; registered persons must conduct business prudently and with integrity, comply with AML/CFT law and applicable sanctions, and maintain adequate records and systems of control.
• Capital and solvency: Insurers and insurance groups must maintain statutory capital and surplus meeting the applicable minimum margin of solvency and Enhanced Capital Requirement (ECR), calculated using the relevant Bermuda Solvency Capital Requirement (BSCR) model or an approved internal capital model. Collateralized Insurers must keep statutory assets exceeding statutory liabilities by at least $250,000.
• Eligible capital tiering: Class 3A, 3B, 4, C, D and E insurers must classify capital into tiers 1, 2 and 3 and meet the prescribed tier composition limits for the MSM and ECR under the Insurance (Eligible Capital) Rules 2012.

Financial reporting and returns

• Statutory financial statements: Insurers must prepare statutory financial statements (balance sheet, statement of income, statement of capital and surplus) using the prescribed forms, notes and instructions under the Insurance Accounts Regulations 1980, in English and in a single currency.
• Statutory financial return: Insurers must file an annual statutory financial return in the prescribed form under section 18(1) of the Act, including auditor's report, solvency certificate, loss reserve or actuary's opinion where required, declarations, and schedules covering cyber risk and sanctions compliance.
• Capital and solvency return: Class 3A, 3B, 4, C, D and E insurers and insurance groups must file a capital and solvency return (BSCR model output plus schedules) by their filing date, with a loss reserve specialist's or actuary's opinion and a declaration signed by two directors and the principal representative, and retain a copy for five years.
• Financial condition report: Under the Insurance (Public Disclosure) Rules 2015, Class 3A, 3B, 4, C, D and E insurers must file an annual financial condition report by the section 17(4)(b) filing date, publish it (within 14 days of filing if they have a website), keep copies for five years, and report significant events.
• Quarterly returns: Class 4 and 3B insurers, certain Class D and E insurers not in a BMA-supervised group, and insurance groups must file quarterly financial returns by the last day of May, August and November, including unaudited statements, intra-group and large-exposure details, the ECR ratio and bonds by rating.
• CISSA and risk disclosures: Class 4 and Class 3B insurers must undertake and file a Commercial Insurer's Solvency Self-Assessment (CISSA) and complete risk register, catastrophe risk and risk exposure schedules, approved by the board.
• Asset and liability statement: From 1 January 2026, Class C, D and E insurers not carrying on domestic business must file an asset and liability statement by the section 17(4) filing date, signed by the CEO and a relevant senior executive, and retain it for five years.

Intermediary and marketplace filings

• Annual returns: Insurance managers, brokers and agents must file an annual return by 30 June each year, with management accounts, a business plan and a two-director declaration, and keep a copy for five years.
• Marketplace providers: Insurance marketplace providers must file a statutory financial return by 30 June each year, with management accounts, business plan and declaration, and retain it for five years.
• Indemnity cover: Insurance managers, brokers, agents and marketplace providers must maintain adequate professional indemnity insurance.

Group supervision

• Governance and functions: Insurance groups must maintain group-level governance structures and independent internal audit, risk management, compliance and actuarial functions; the parent board must review board and executive composition at least every three years and review conflict-of-interest policies and the group solvency self-assessment annually.
• Cyber risk: Groups must appoint a Chief Information Security Officer, maintain a cyber risk programme and report cyber reporting events to the Authority.
• Significant events: A significant event occurring after the filing date must be reported to the Authority within 14 days, published within 30 days of submission where the group has a website, and retained on file for five years.

Notifications, recovery plans and fees

• Notifications: Registered persons must notify the Authority of changes in shareholder control, changes of officers, material changes to the insurer, group or marketplace provider, and cyber reporting events.
• Recovery plans: Under the Insurance (Prudential Standards) (Recovery Plan) Rules 2024, Class 3A, 3B, 4, C, D and E insurers and insurance groups must prepare, correct or update a recovery plan when the Authority issues a written notice, and review and update it at least every three years or on a material change, filing updates within 30 days.
• Annual fees: Insurers, designated insurers, insurance groups and IAIGs must pay the annual fees set out in the relevant schedule to the Bermuda Monetary Authority Act 1969, due on or before 31 March; intermediaries pay prescribed registration, application and annual fees.
• Information duty: Financial institutions and other persons must furnish information and documents to the Authority when required, and auditors of financial institutions have a duty to communicate certain matters to the Authority.

Sources: Bermuda Monetary Authority Act 1969 · Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Amendment Rules 2025 · Insurance Act 1978 · Insurance Accounts Regulations 1980 · Insurance Returns and Solvency Regulations 1980 · Insurance (Prudential Standards) (Insurance Brokers and Agents Annual Return) Rules 2018 · Insurance (Prudential Standards) (Insurance Group Solvency Requirement) Rules 2011 (BR 77/2011) · Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Rules 2011 · Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Rules 2008 (BR 83/2008) · Insurance (Group Supervision) Rules 2011 - Schedules · Insurance (Group Supervision) Rules 2011 · Insurance (Eligible Capital) Rules 2012 (BR 62/2012) · Insurance (Public Disclosure) Rules 2015 · Insurance (Prudential Standards) (Recovery Plan) Rules 2024 · Insurance (Prudential Standards) (Insurance Managers Annual Return) Rules 2017 · Insurance (Insurance Marketplace Providers) (Statutory Financial Return) Rules 2020 · Insurance (Collateralized Insurers) (Statements, Returns, Solvency and Capital) Rules 2020 · Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Amendment (No. 2) Rules 2022 · Insurance (Group Supervision) Rules 2011 (BR 76 / 2011) · Insurance (Prudential Standards) (Class 4 Solvency Requirement) Amendment Order 2010 · Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Amendment Order 2010

Exemptions and carve-outs

The instruments provide a mix of activity-based carve-outs and a general power for the Authority to modify or waive particular requirements.

• Non-resident risks outside Bermuda: The Non-Resident Insurance Undertakings Act 1967 does not apply to a non-resident undertaking whose entire insurance business concerns persons, property and risks outside Bermuda; it also does not apply to Bermuda-incorporated insurers or Bermuda residents authorised to conduct insurance business locally, and policies made before 31 March 1967 are saved.
• Life Insurance Act scope: The Life Insurance Act 1978 does not apply to superannuation or pension schemes (with limited exceptions) or to Workmen's Compensation Act payments, and only governs contracts made after its 1978 commencement.
• Investment business carve-out: Under the Investment Business (Non-Registrable Persons) (Designation) Order 2022, registered insurers and insurance intermediaries and marketplace providers are not required to register under the Investment Business Act 2003 for investment business connected with their insurance business.
• Section 6C modifications: The Authority may exempt or modify prudential and reporting requirements under section 6C of the Insurance Act 1978, for example for Collateralized Insurers and for quarterly filing where equivalent information is available from an insurer's group supervisor.
• Group quarterly returns: Insurers that are part of a group for which the Authority is group supervisor may be exempted from, or granted modified, quarterly financial return requirements.
• Public disclosure relief: Under the Insurance (Public Disclosure) Rules 2015, the Authority may modify or exempt an insurer from disclosure in specified circumstances (competitive disadvantage, confidentiality, legal prohibition, equivalent disclosure, or group supervision), but cannot exempt an insurer from disclosing capital management particulars.
• Reduced AML content: An insurance broker or agent that is not an AML/ATF regulated financial institution need only complete the corporate governance section of the AML/ATF schedule in its annual return.
• Recovery plan trigger: Recovery plan obligations arise only once the Authority issues a written notice; an insurer so notified may apply to adopt a plan already filed with an overseas or group-wide supervisor, subject to the Authority's approval.

Sources: Insurance Act 1978 · Non-Resident Insurance Undertakings Act 1967 (1989 Revision) · Life Insurance Act 1978 · Insurance (Prudential Standards) (Insurance Brokers and Agents Annual Return) Rules 2018 · Investment Business (Non-Registrable Persons) (Designation) Order 2022 · Insurance (Prudential Standards) (Class 4 and Class 3B Solvency Requirement) Rules 2008 (BR 83/2008) · Insurance (Public Disclosure) Rules 2015 · Insurance (Prudential Standards) (Recovery Plan) Rules 2024 · Insurance (Insurance Marketplace Providers) (Statutory Financial Return) Rules 2020 · Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Amendment (No. 2) Rules 2022

Enforcement and penalties

Enforcement powers sit primarily in the Insurance Act 1978, supported by specific offence and civil-penalty provisions in the subsidiary rules and other Acts.

• Insurance Act powers: The Insurance Act 1978 gives the Authority powers of investigation, entry and information-gathering and disciplinary tools including civil penalties, public censure, prohibition orders and injunctions, together with grounds and process for cancellation of registration and winding-up.
• Public disclosure penalties: Under the Insurance (Public Disclosure) Rules 2015, failure to file a financial condition report or significant event report carries a civil penalty for each week or part-week of non-compliance: up to $1,000 for Class 3A or Class C insurers and up to $5,000 for Class 3B, 4, D or E insurers (the higher penalty applying where an insurer falls into more than one category).
• False returns offence: Under the Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Rules 2011, knowingly or recklessly making a false or misleading statement or return is an offence carrying a fine of up to $50,000 on summary conviction.
• Non-resident permits: Under the Non-Resident Insurance Undertakings Act 1967, conducting business without a valid permit or breaching its conditions is punishable summarily by up to 1 month imprisonment or a $15,000 fine for a first offence, rising to 6 months or $30,000 for repeat offences; late renewal payment may be accepted with a $1,000 penalty where non-payment was not wilful.
• Accounts offences: Under the Insurance Accounts Regulations 1980, failing to comply with a duty imposed by the Regulations, or knowingly making or joining in a false or materially misleading statement in an account, is an offence.
• BMA Act offences: The Bermuda Monetary Authority Act 1969 creates offences for transmitting false information to the Authority, for falsely verifying an account or report, and for failing to furnish required information.

Sources: Bermuda Monetary Authority Act 1969 · Insurance Act 1978 · Non-Resident Insurance Undertakings Act 1967 (1989 Revision) · Insurance Accounts Regulations 1980 · Insurance (Prudential Standards) (Class C, Class D and Class E Solvency Requirement) Rules 2011 · Insurance (Public Disclosure) Rules 2015