Cayman update: Continued growth and an assured future

Driven by innovative structures and niche services tailored to specific licence classes, Cayman has seen an increase in new managers, says Kevin Poole, general manager of IMAC

 

Statistics for 2023 released by the Cayman Islands Monetary Authority (CIMA) showed the jurisdiction issued 41 new international insurance licences that year, the largest number of licences issued in a single year in more than a decade.

This meant the year closed with 683 class B, C and D insurance companies in the Cayman Islands, the second highest number since 2017. CIMA has now released 2Q 2024 statistics which showed that between April and June 2024, CIMA issued 12 new international insurer licences plus two new insurance manager licences.

A total of 24 new international insurance licences have been issued in 2024, representing a 50% increase over the same period in 2023. There are now 700 class B, C and D insurance companies licensed in Cayman, with approximately $40 billion in premiums written and $151 billion in total assets.

While Cayman anticipated increased licensing activity in 2024, driven by a number of factors including the hard market for certain lines and specialist lines of coverage, the number of new licences in the first half of 2024 has been very encouraging. This trend is a positive indicator for the rest of the year.

Reinsurance

Part of the reason for this upward trend is the growth of the reinsurance market. This led to the formation of the Cayman Islands Reinsurance Companies Association (CIRCA) in 2020; it currently has more than 50 full and associate members.

In April 2024 CIRCA held ReConnect, the first dedicated reinsurance conference in the Cayman Islands, attracting close to 450 delegates.

ReConnect successfully showcased the Cayman Islands’ emergence as a key player in the reinsurance sector.

Types of structures

When evaluating a jurisdiction, it is crucial to consider the types of structures permitted. In Cayman, insurers and reinsurers can be structured as single-parent, group captives, cell companies (segregated portfolio companies or SPCs), or with incorporated cell structures (portfolio insurance companies or PICs).

Fully collateralised transactions and open market reinsurers may also be licensed. These various structures correspond to different licence classes, each with specific capital requirements.

Overall, Cayman offers an unparalleled variety of products and services, supported by a wide array of service providers. This diversity benefits licensees and contributes to the jurisdiction’s growth.

Insurance managers

Cayman is home to more than 20 insurance managers, responsible for the daily operations of licensees.

Driven by innovative structures and niche services tailored to specific licence classes, Cayman has seen an increase in new managers. In Cayman, insurance managers must be licensed, unlike in many US states where they only need approval.

This grants CIMA greater oversight and regulatory power, including periodic onsite inspections. These inspections ensure that licensees and insurance managers comply with regulations and follow operational guidelines.

This added layer of oversight provides licensees with extra assurance when doing business in Cayman.

The regulator

The industry recognises that the jurisdiction’s impressive growth wouldn’t be possible without a highly regarded and professional regulator.

CIMA is globally renowned for its high level of insurance and reinsurance expertise. The Cayman Islands stands out due to its streamlined licensing process and efficient regulatory framework for insurance and reinsurance companies.

CIMA’s robust principles-based approach has been welcomed by insurance, reinsurance entrants and ceding carriers for many years.

Cayman has not committed to aligning its regulatory regime with Solvency II, which is appealing to US carriers and non-EU reinsurance companies seeking a regulatory framework not defined by EU market requirements.

Cayman Captive Forum 2024

IMAC celebrated the 30th anniversary of the Cayman Captive Forum (CCF) in 2023. This year it will be held on December 3 to 5 at the Ritz-Carlton, Grand Cayman.

The CCF continues to be a “not to miss” event offering the highest quality educational and networking opportunities, arranged by the industry for the industry.

The full agenda will be published soon, but the CCF has announced two keynote speakers:

  • Anthony Robles, a three-time All-American wrestler, NCAA Wrestling Champion, and National Wrestling Hall of Fame inductee, will be the opening keynote speaker. Born with one leg, Robles has overcome adversity to become a symbol of courage and perseverance. He has won multiple wrestling titles and is also a member of the Arizona Sports, and ASU’s Sun Devil Athletics Halls of Fame. Robles is the subject and author of the upcoming film, Unstoppable, produced by Matt Damon and Ben Affleck’s production company. He is a wrestling analyst for ESPN and Pac-12 Network. Robles’ keynote will inspire attendees with his message of hard work and self-belief.
  • The cyber keynote speaker will be Jon Engstrom, a 20-year veteran of a major US metropolitan police department and certified ethical hacker. Engstrom has led the agency’s Criminal Intelligence and Cyber-Crime Section and the threat assessment and incident response operations for the region’s Real-Time Crime Centre. He has also worked as a Federal Task Force Officer, conducting undercover and electronic surveillance operations for organised crime investigations. Engstrom will discuss recent trends in online fraud, computer intrusion, and emerging cyber threats.

Registration for the Cayman Captive Forum 2024 is now open. As the world’s largest captive insurance conference, the three-day event is expected to attract more than 1,500 delegates.

For more information, including sponsorship opportunities, visit: https://www.imac. ky/captive-forum/

The future

The Cayman Islands has been a leading captive insurance domicile for over 50 years. To achieve such longevity has required careful nurturing to ensure continued growth through increased sophistication, innovation and product offerings.

Recognised as a major global financial centre, Cayman boasts a large and diverse financial services sector.

It is a top international banking centre, the leading domicile for alternative investment funds, the second-largest captive domicile, and a world leader in structured finance – the growth in reinsurance is now part of its evolution.

Cayman stands out as the only offshore international financial centre with such extensive breadth and depth in financial services.

The Cayman Islands attracts business with its professional infrastructure, business friendly approach, flexibility, English common law framework, stability, well-regulated regime and tax neutrality.

The future is as bright as the Cayman Islands sunshine. We invite you to explore what the Cayman Islands has to offer – you won’t be disappointed.

Ryan exits Robus for Marsh

Ronan Ryan joins Marsh Captive Solutions’ Dublin office after four years with Robus Group   Marsh Captive Solutions...
MORE

Artex acquires Risk International

Ohio-based firm provides outsourced risk management and employee benefits advisory services   Artex, has acquired Ohio-based RIBV Holdings,...
MORE

Kenneson targeting captives looking for a “multidimensional” solution

Jeff Kenneson says his new consultancy formed earlier this year offers a one-stop shop for captive owners, which...
MORE

MAXIS partners with women’s health clinic

Launches a new educational toolkit in partnership with Maven Clinic enabling multinationals to educate their people about the...
MORE