Insurance (Portfolio Insurance Companies) Regulations, 2015

Summary

This is a 2015 Cayman Islands regulation made under the Insurance Law, 2010 that sets out the detailed registration, capital, solvency and reporting regime for "portfolio insurance companies" (PICs) - a special category of segregated, cell-like insurer that is controlled by and reinsures for a "controlling relevant insurer". The Regulations define classes of admissible assets (class 1 through class 8) used to calculate a PIC's margin of solvency, and prescribe how minimum capital requirements (MCR) and prescribed capital requirements (PCR) are calculated and reviewed by the Cayman Islands Monetary Authority (CIMA).

Registration Forms and Fees

• Registration application: Schedule 1, Form 1 prescribes the application form and process for registering a PIC.
• Fees: Schedule 2, Form 1 sets a $1,000 non-refundable application fee and a $250 annual fee.
• Capital requirement forms: Schedule 2, Forms 2 and 3 are used for calculating capital requirements.
• Annual return and declaration: Schedule 1 Form 2 and Schedule 3 provide the annual return and declaration forms.
• Certificate of registration: Schedule 4 sets out the certificate of registration.

Ongoing Requirements

• Annual filings: PICs must annually file audited financial statements, an annual declaration, an actuarial valuation, a certificate of solvency and other information within six months of the PIC's financial year end.
• PCR calculation: The PCR must be calculated at each filing date.
• Capital shortfalls: If capital falls below prescribed or minimum thresholds, specific action is required, such as a meeting with CIMA and a remedial action plan, or potential regulatory action.
• Notification of changes: PICs must promptly notify CIMA of changes to information supplied in their registration application, as noted on the certificate of registration.

Key obligations

• An applicant for registration as a portfolio insurance company must submit an application in the form prescribed in Schedule 1, Form 1, including a business plan and consent of the controlling relevant insurer.
• A registered PIC must pay the application fee and annual fee set out in Schedule 2, Form 1.
• A PIC must maintain admissible assets and liabilities in accordance with regulation 5 to determine its margin of solvency.
• A PIC must maintain the minimum capital requirement and prescribed capital requirement calculated per Schedule 2, Form 2, unless CIMA approves an internal capital model or a modified requirement.
• At each filing date, a PIC must calculate and record its prescribed capital requirement using Schedule 2, Form 3.
• Where a PIC's capital falls below the prescribed capital requirement but remains above the minimum capital requirement, the PIC must meet with CIMA and present a remedial action plan.
• Where a PIC's capital falls below the minimum capital requirement, CIMA may take regulatory action against the PIC.
• Every PIC (unless exempted) must, within six months of the end of its financial year, submit audited financial statements, an annual declaration (Schedule 1, Form 2), an actuarial valuation, a certificate of solvency, and any other information requested by CIMA.
• PICs that do not conduct long-term business, or that conduct the type of insurance business described in section 4(3)(c) of the Law, are not required to submit the actuarial valuation or certificate of solvency.
• The registrant must forthwith notify CIMA of any change in the information supplied in its registration application, as stated on the certificate of registration.

Applies to

portfolio insurance companies, controlling relevant insurers

Deadlines

• within six months of the end of its financial year: Deadline for a PIC to submit audited financial statements, annual declaration, actuarial valuation, certificate of solvency and other required information/annual return to CIMA.
• within six (6) months of the end of each financial year: Deadline for making the Annual Declaration Form (Schedule 1, Form 2) during the continuation of the PIC's registration.

Related documents

• Insurance (Portfolio Insurance Companies) (Amendment) Regulations, 2024 (SL 69 of 2024) amends this document
• Insurance (Portfolio Insurance Companies) Regulations (2026 Revision) replaces this document