Welcome to the latest edition of the Conyers Bermuda Insurance Bulletin. It is hard to believe that the second quarter of the year is well underway! The Bermuda (re)insurance sector has had a strong start to 2025 following a busy 2024. During the course of last year, 75 new insurers and intermediaries were registered on the island, compared with a total of 67 registrations in 2023.
As we continue to reflect on 2024 and gear up for the rest of 2025, the overarching theme which has featured prominently among industry commentators is evolution. The (re)insurance industry has evolved tremendously in recent years due to socio-economic, geopolitical and environmental shifts coupled with factors such as technology and innovation. In response, the Bermuda regulatory landscape has remained resilient and highly adaptable.
In this Bulletin, we recap on some of the highlights of the past year. We also touch on certain key developments expected during the rest of 2025. We hope you find this Bulletin an insightful and informative read.
Market Overview
The Bermuda Monetary Authority's ("BMA") recent implementation of additional regulatory enhancements align with its ongoing mission to ensure its supervisory framework continues to address an ever-evolving (re)insurance industry. The enhancements, which aim to provide increased comfort to policyholders, cedants and other stakeholders have been met with a steady influx of new transactions and entrants to the market. The continued influx affirms Bermuda as the offshore domicile of choice for (re)insurers and capital providers in the (re)insurance space.
This market overview features certain key (re)insurance transactional and regulatory matters driving growth within the life and annuity, property and casualty (P&C) and insurance-linked securities (ILS) markets.
Life after CP2
In March 2024, amendments to the commercial (re)insurers and (re)insurance group prudential rules took effect, memorializing all of the enhancements to the commercial long-term regime that the BMA previewed throughout 2023 with local industry stakeholders via CP2. As existing Bermuda (re)insurers and (re)insurance groups spent most of 2024 moving towards the implementation of the new rules, Bermuda also saw the establishment of 13 additional commercial life and annuity (re)insurers and the completion of a number of new transactions. These developments contributed to the already significant volume of business being ceded to Bermuda from jurisdictions such as the US and Japan. Early 2025 has continued to show momentum, with several new reinsurers being licensed, existing life and annuity reinsurers looking to partner with private capital providers to further grow their business and the first wave of filings under the amended prudential rules (now complete), demonstrating robust industry adoption and compliance.
Property and Casualty: navigating climate change and innovation
In recent years, climate change and technology has played a significant role in the evolution of the P&C industry. These shifts have presented both challenges and opportunities. On one hand, climate change and technology have increased risk and exposure in the (re)insurance industry. On the other hand, climate change and technology have offered a unique opportunity to redefine how risk is assessed, protection gaps are determined, products are developed and claims are managed. Notably, the BMA's strategic objectives for 2025 identified climate change and the use of AI within the (re)insurance sector as key focus areas. It follows that we can expect greater integration of these themes within the Bermuda regulatory and supervisory framework.
The changes within the P&C space have not dampened growth. In September 2024, member companies of the Association of Bermuda Insurers and Reinsurers (ABIR) reported record gross written premium of over US$171 billion in 2023, up from the US$145 billion figure that was reported in 2022. Above all, Bermuda (re)insurers continue to play a significant role in the global P&C industry. Putting this role into context, Bermuda-based (re)insurance companies are projected to settle gross claim losses of approximately US$10 billion stemming from the catastrophic wildfires which impacted Southern California in January 2025. Currently, industry-insured losses are projected to exceed US$30 billion. Assuming losses at this level, Bermuda's (re)insurance market is expected to bear approximately 30% of the total insured losses stemming from the wildfires.
Insurance-Linked Securities: increased size and complexity
Over the course of the last year, there was a raft of significant cat bond transactions for existing ILS sponsors with a number of Issuers now providing over a billion dollars of coverage. The industry continues to explore a number of innovative new offerings and cyber risks in particular continue to be a main topic of conversation. At the start of 2025, the first ever Canadian cat bond was an exciting development and we look forward to further deals from the Great White North.
Of course, cat bonds haven't been the only deals on the block over the last year. We were delighted to note the various Collateralised Insurer registrations over the past year. The Collateralised Insurer class was introduced by the BMA in 2019 in recognition of the increasing sophistication of the ILS market. The market has also been keen to take advantage of the flexibility offered by the unrestricted SPI model (also introduced in 2019). We are seeing these vehicles being used by sponsors looking to provide access to the market by new players, both investors and cedants.
Regulatory Watch List
Bermuda has introduced a number of proposed regulatory enhancements over the last year. In case you have missed anything or need to recap, we have summarized publications relating to key changes which should be on your organisation's watch list to address in the weeks and months ahead. If you have any questions regarding the following regulatory developments feel free to reach out to your usual Conyers contact.
Proposed Changes to Beneficial Ownership Register Legislative Framework: In 2020, the Bermuda Government made a global commitment to establish public access to the beneficial ownership information of all entities registered in Bermuda in response to EU requirements imposed on low tax jurisdictions. These changes are part of a phased plan to provide greater transparency and meet global commitments. The proposals confirm a beneficial owner as an individual who ultimately owns or controls 25 per cent or more of a company's shares or voting rights or who otherwise exercises control over the company or its management. It is expected that the implementation of a beneficial ownership register which would apply to all entities registered in Bermuda (including insurers but excluding companies listed on an appointed stock exchange) will be introduced through a phased approach commencing this year.
Read the full Consultation Paper here.
Board Effectiveness Reviews: The BMA's revised Insurance Code of Conduct issued in September 2022 introduced a requirement to conduct board effectiveness reviews at least once every three years. The purpose of the board effectiveness reviews is to ensure that board members and the senior executives remain fit and proper for those roles and that the members of the board, board committees and executive management individually and collectively have the requisite knowledge, skills, expertise, diversity, tenure and resources required to manage the relevant (re)insurer's operations. (Re)insurers that have not yet completed an effectiveness review, should plan to do so in 2025.
Read the Insurance Code of Conduct here.
Management of Climate Change Risks for Commercial Insurers: In August 2022 and March 2023 the BMA issued Guidance Notes relating to the "Management of Climate Change Risks for Commercial Insurers". The 2023 Guidance Notes provided that from year-end 2023 onwards all commercial insurers must assess how climate change risks and its exposures affect their operations. Under the Guidance Notes, (re)insurers should ensure that a full framework and operational processes for assessing, reviewing and monitoring climate change risks are in place by year-end 2025.
Read the 2022 Guidance Notes here.
Read the 2023 Guidance Notes here.
Payroll Tax Relief for Qualifying Employees: The Payroll Tax Amendment Act 2024, which came into effect on 25 March 2024 introduced a revised "new hire" relief until 31 March 2026. The Amendment Act applies to certain eligible employers (including, without limitation, all exempted companies) with the objective of stimulating employment growth by providing payroll tax relief to employers for qualifying new hires. We expect this to be a welcome relief for those (re)insurers looking to build out their staffing footprint in Bermuda.
Read the full Amendment Act here.
Guidance Note on the Recovery Planning Requirements for Bermuda Commercial Insurers: In April 2024, the BMA introduced a recovery planning framework pursuant to the Insurance (Prudential Standards) (Recovery Plan) Rules 2024. The Rules came into effect on 1 May 2025; however, only those (re)insurers which are assessed by the BMA as being of economic importance, systemically significant or whose failure could pose a threat to the financial stability of Bermuda, are required to comply at this stage. Those (re)insurers which are in scope of the Rules would have received formal communication from the BMA on the requirement to prepare a recovery plan. In addition, the BMA issued a further Guidance Note for consultation on the topic on 11 April 2025. The consultation period ends on 30 September 2025.
Read the full Guidance Note here.
Guidance Note on General Business Insurers with Segregated Accounts and Separate Accounts: In July 2024, the BMA released a draft of its long-awaited guidance note entitled "General Business Insurers with Segregated Accounts and Separate Accounts". The draft Guidance Note is intended to provide the industry with clarity on the regulatory regime and requirements for Bermuda (re)insurers using segregated accounts and separate accounts. The Guidance Note, which applies only to general business insurers including Commercial Insurers (Classes 3A, 3B and 4), Limited Purpose Insurers (Classes 1, 2 and 3), Special Purpose Insurers, Collateralised Insurers and IIGB (innovative insurers), remains in discussion with industry and is expected to be finalised, and to take effect, in due course.
Read the full Guidance Note here.
Proposed Enhancements to the Insurance Group Supervision Framework: On 4 December 2024, the BMA issued the Consultation Paper, "Proposed Enhancements to the Insurance Group Supervision Framework". The Consultation Paper proposed updates to the BMA's Insurance Group Supervision Framework which seek to strengthen the regulation and supervision of (re)insurance groups. The enhancements align Bermuda's regime with international standards and reflect growing global expectations for group-wide supervision. The consultation period ended on 15 January 2025. Response to stakeholder feedback to the Consultation Paper was published by the BMA on 6 May 2025 and a draft Bill is expected to be published by the BMA imminently.
Read the full Consultation Paper here.
Instructions and Guidance on the Application of the Prudent Person Principle: On 4 December 2024, the BMA also issued the Consultation Paper "Proposed Instructions and Guidance on the Application of the Prudent Person Principle" applicable to commercial (re)insurers and (re)insurance groups and outlining the BMA's expectations for (re)insurers in managing investment risks. The consultation period ended on 5 February 2025 and the BMA has proposed that the Instructions and Guidance come into effect on 1 July 2025.
Read the full Consultation Paper here.
Public Disclosure of Assets and Liabilities for Long-Term Insurers: On 23 December 2024, the BMA issued the Consultation Paper, "Proposed Enhancements to Public Disclosure Regime: Public Disclosure of Assets and Liabilities for Commercial Long-term Insurers". The Consultation Paper proposed changes aimed at increasing transparency by requiring (re)insurers to publicly disclose detailed information on both assets and liabilities, enabling stakeholders to better evaluate (re)insurers' financial condition, governance and risk exposure. The consultation period ended on 28 February 2025.
Read the full Consultation Paper here.
Operational Resilience and Outsourcing Code: In January 2025, the BMA issued the Consultation Paper "Operational Resilience and Outsourcing Code" which outlines new standards for (re)insurers on the subject. The Consultation Paper sets out proposed requirements on identifying important business services, establishing impact tolerances for disruption, and ensuring robust governance and risk management when relying on third-party providers. For (re)insurers, this means enhancing their governance and risk management frameworks to better manage risks related to system disruptions and outsourcing arrangements
Read the full Consultation Paper here.
Insights and Reflections on Asset Intensive Reinsurance (AIR) in Bermuda: In March 2025, the BMA issued a report entitled, "Insights and Reflections on Asset Intensive Reinsurance (AIR) in Bermuda," highlighting the growing demand for asset-intensive (re)insurance (AII) and the corresponding rise in AIR. The report outlines the factors driving this growth and the regulatory framework supporting AIR in Bermuda.
Read the full Insights Report here.
Notice on Prior Approval of New Long-Term Block Reinsurance Transactions: In April 2025, the BMA issued an update on its previous notice from April 2024 on "Prior Approval of New Long-Term Block Reinsurance Transactions". The notice updates and clarifies the scope of transactions included under the prior approval process and the information to support a block transaction's prior regulatory approval request.
Read the 2024 Notice here.
Read the 2025 Notice here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
