Bermuda Warns Of Imminent Reclassification Deadline

by Amanda Banks, Tax-News.com, London

27 September 2011

The Bermuda Monetary Authority has issued a last reminder that any remaining Long-Term insurers who have not yet submitted the necessary documents for reclassification have just days to do so. Failure to comply with the requirement could result in the cancellation of insurers' and reinsurers' registration.

In order to be compliant with the Insurance Amendment (No. 3) Act 2010, every insurance company currently registered as a Long-Term insurer must apply to the Authority by September 30, 2011, to be reclassified within several recently introduced new classes.

Shelby Weldon, the Authority’s Director of Insurance, Licensing & Authorization said: “We appreciate the cooperation we have already received from the market for this reclassification process. We wish to remind the firms who have yet to submit their applications to send them in prior to the end of this month. We do not wish any firms to find themselves in the unfortunate position of being in breach of the regulations.”

The reclassification is part of the Authority’s work to enhance solvency and reporting standards for Long-Term insurers. The Authority is introducing new classification categories for these firms, as up until this point the Long-Term insurers have been placed in one class. The Authority is segregating these firms based on their risk profile, and this will allow the Authority to further refine and apply the appropriate level of supervision to the different firms across the Long-Term sector.

When reapplying, companies must submit their: original certificate of registration; most recent audited statutory financial statements; management accounts as at December 31, 2010, or more recent if available; and the applicable application fee of BMD500 (USD500) in the case of Class A and Class B and BMD1,000 in the case of Class C, D, or E entities.

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