The legislation also allows the reclassification of the class 3 insurance sector, currently including firms ranging from captives writing a limited amount of third party business to large commercial (re)insurers. The reclassification focuses on the respective risk profiles of the class 3 companies. The reclassification also includes a new category for insurance special purpose vehicles (SPVs), to be known as ‘Special Purpose Insurers’, intended to make it less costly for SPVs to be established in Bermuda.
The BMA is focusing on its objective to achieve equivalence, or mutual recognition status, in Europe and elsewhere. Following implementation of the European Reinsurance Directive, now completed in most European states, full mutual recognition status between Bermuda and the European Union has the potential to simplify access by insurers and reinsurers in each market to the other.