Insurance Market Celebrates Reciprocal Status
Bermuda’s global insurance market praised the efforts of the Bermuda Monetary Authority [BMA] and the strength of its regulatory regime in being granted Reciprocal Status, a new designation introduced this year, by the National Association of Insurance Commissioners [NAIC], the U.S. insurance regulatory body.
Bermuda’s elevated status, effective 1 January 2020, makes it one of only three jurisdictions recognized as being on par with the U.S. and means Bermuda-based [re]insurers can operate in the market without additional capital requirements.
This puts Bermuda on an equal footing with its counterparts from the EU and the UK and further adds to its renewed Qualified Jurisdiction status, a pre-requisite to achieving Reciprocal Status, also granted by the NAIC following its five-year re-evaluation.
Roland Andy Burrows, CEO of the Bermuda Business Development Agency [BDA], said: “Today’s endorsement from the NAIC is a significant win for Bermuda and testament to the hard work that takes place to ensure we remain at the forefront of the global [re]insurance market. We thank the BMA for their efforts, as well as the NAIC and all our industry stakeholders, and look forward to a positive 2020.”
“Given the significant role Bermuda’s [re]insurers play in supporting the U.S. economy, paying out more than $200 billion to settle U.S. losses over the last two decades, American businesses and consumers also stand to benefit from greater efficiencies and access to Bermuda’s capital and expertise,” a spokesperson said.
Stephen Weinstein, Deputy Chair of the BDA, said: “We were very pleased to see Bermuda’s robust, fit-for-purpose regulatory regime accorded this important distinction from the NAIC, whose standards are respected worldwide. Insureds, intermediaries and communities across the U.S. will only benefit from ensuring level playing field access to Bermuda’s capital and risk management expertise, and from further reducing the costs of exporting risk to the Bermuda market.
“The staff of the Bermuda Monetary Authority deserve our appreciation both for their success in being one of three regulators worldwide to obtain this designation, and for their sustained efforts over the years to protect policyholders while adapting to changes in the industry and the underlying markets and communities we serve.”
Industry representatives from across Bermuda celebrated the news and echoed the positive comments:
John Huff, President, Association of Bermuda Insurers and Reinsurers [ABIR] said “Bermuda’s leading reinsurers have long been reliable partners in providing natural catastrophe and specialty reinsurance and a growing amount of cyber insurance protection for U.S. consumers. The hard earned ‘reciprocal jurisdiction’ status demonstrates the quality of Bermuda’s world-class regulatory regime and gives Bermuda a competitive edge against other international markets.”
Ronnie Klein, Senior Advisor, Bermuda International Long Term Insurers and Reinsurers [BILTIR] also said, “NAIC qualification is extremely important to BILTIR member companies as much of our business is transacted in and with the U.S. We are proud to be considered in the same jurisdictional category as Japan and Switzerland and it shows that all of the hard work the Bermuda Monetary Authority has done paid off. BILTIR members will continue to partner with the BMA to make certain that Bermuda remains NAIC-qualified.”
