Regulatory Policy - Licencing for Class D Insurers

Summary

This CIMA Regulatory Policy sets out the criteria and procedure the Cayman Islands Monetary Authority applies when assessing applications for a Class D insurer licence, which authorises the carrying on of reinsurance business (and other approved business) under section 4 of the Insurance Act. It applies to corporate entities seeking to establish or convert to a Class D insurer in or from the Cayman Islands, including existing Class B insurers converting to Class D and existing reinsurers redomiciling to the Islands.

Application Process

• Submission of a completed application form
• Payment of fees
• Presentation to CIMA's Management Committee

Assessment Criteria

• Fitness and propriety: Assessment of directors, managers, officers and controllers
• Ownership and control disclosure: Includes disclosure of ultimate beneficial owners (UBOs) with 10% or more control
• Corporate governance framework: Evaluation of the applicant's governance arrangements
• Detailed business plan: Covering the reinsurance programme, retrocession, security arrangements, claims management, reserving and actuarial matters
• Conversions and redomiciliations: Additional information required from applicants converting from Class B or redomiciling from another jurisdiction

Post-Approval Requirements

• Issuance timeline: Licences are generally issued within 2-3 business days once approval conditions are met
• Conditional approvals: Where approval is subject to conditions, applicants must satisfy them within 6 months, extendable at CIMA's discretion, or the approval becomes null and void

The policy should be read alongside the Insurance Act, its Regulations and Rules, and related CIMA regulatory policies (for example, on fitness and propriety, corporate governance, and succession planning). It does not itself impose new law but operationalises existing statutory licensing requirements.

Key obligations

• Persons seeking to carry on reinsurance business as a Class D insurer must submit a completed application form with all information required under the Act and Regulations.
• Applicants must pay licence application fees as prescribed under the Insurance (Applications and Fees) Regulations when making an application.
• Where approval of an application is subject to requirements, the Applicant must meet those requirements within 6 months of the date of approval, or the approval becomes null and void (unless an extension is granted by the Authority).
• Any changes to information provided in the application prior to licence grant must be disclosed to the Authority immediately and approved by the Management Committee.
• Applicants must provide a complete ownership structure chart identifying all UBOs with 10% or more control, including intermediary holding/operating entities.
• Each UBO with 10% or more control must submit a Personal Questionnaire and supporting documentation per the Regulatory Procedure on Assessing Fitness and Propriety.
• Applicants must provide a draft corporate governance framework and list all proposed directors, indicating whether each is a parent/group representative or an Independent Director.
• Applications must be accompanied by a sufficiently detailed business plan covering the reinsurance programme, transaction flows, retrocession arrangements, security/collateral arrangements, claims management approach, and reserving methodology as specified in section 7.10.
• Segregated portfolio companies must satisfy the assessment criteria separately for each proposed segregated portfolio/portfolio insurance company.
• Existing reinsurers redomiciling to the Cayman Islands must submit additional specified information, including evidence of home-jurisdiction redomiciliation approval, governance changes, litigation status, audited financial statements (up to 5 years), and actuarial reserving reports (last 3 years).
• Applicants converting from an existing Class B insurer licence must remit the applicable licence fee and provide required additional documentation before the Authority cancels the Class B licence and issues the Class D licence.

Applies to

Class D insurers (applicants), reinsurers, Class B insurers converting to Class D, segregated portfolio companies/portfolio insurance companies (PICs), reinsurers redomiciling to the Cayman Islands

Deadlines

• within 6 months of the date of approval: Where approval of a Class D insurer application is subject to conditions/requirements, the Applicant must meet those requirements within this period or the approval becomes null and void (extension possible at the Authority's discretion).
• 2-3 business days: Once approval requirements are met by the Applicant, the licence certificate will be issued within this timeframe.