Bermuda’s superpowers: flexibility and a regulator willing to engage

Bermuda’s long-standing appeal as a captive domicile rests not only on history, but on its ability to evolve with clients’ needs while maintaining a respected and responsive regulatory framework.

That was the message from the session Bermuda captives: History, global relevance and emerging opportunities, held at the 2026 BMA Forum, entitled Charting the course: Managing risk and complexity in a rapidly evolving landscape, which took place in Bermuda in April.

The session, and wider conference, presented a good opportunity to take the pulse of Bermuda’s captive market, in terms of the mood and general optimism of its practitioners and where individuals see its direction of travel heading.

Moderated by Gerald Gakundi, deputy managing director – head of insurance and investment funds, Bermuda Monetary Authority, the panel featured Mia Smallman, director, global benefits, Halliburton, and Tawana Tannock, managing director, Skuld Mutual Protection and Indemnity Association (BDA). Together, they explored how Bermuda’s captive market has developed over decades and why it continues to attract sophisticated global organisations navigating increasingly complex risk environments.

Growth follows concept

Gakundi began by anchoring the discussion in the origins of captive insurance itself. The concept, which dates back to the mid-20th century, was born out of companies’ desire to take greater control over their own risk financing. Bermuda, he noted, quickly became one of the earliest and most important hubs for that activity.

By the time the Bermuda Monetary Authority (BMA) was established in 1969, the island already hosted a significant number of captive insurers. This early adoption was not incidental. Bermuda developed in parallel with the captive model, building expertise, infrastructure and regulatory oversight alongside the evolution of the industry itself.

That legacy still matters today. It has helped shape a jurisdiction that is not only familiar with captive structures but deeply embedded in their ongoing development. Yet, as the panel made clear, history alone is not enough to sustain relevance.

Innovation a constant, not exception

What distinguishes Bermuda, according to the panellists, is its ability continuously to adapt as the needs of captive owners change.

Tannock pointed to innovation as a defining feature of the jurisdiction. Over time, Bermuda has introduced structures and regulatory mechanisms designed to increase flexibility and efficiency, including developments such as segregated accounts companies and differentiated licensing frameworks. These innovations have allowed insurers and reinsurers to structure risk in ways that align more closely with their operational realities.

Rather than force companies into rigid templates, the jurisdiction has created an environment where structures can be tailored. This flexibility enables organisations to manage risk more precisely, protect capital more effectively and respond to shifting market conditions without needing to relocate or fundamentally restructure their operations.

Importantly, innovation in Bermuda has not been limited to products or legal structures. It has also been reflected in how those structures are used. Captives originally established for narrow or contingent purposes have, over time, become platforms for broader risk management and financing strategies.

Single-purpose tools to strategic platforms

This evolution was illustrated by Smallman’s description of Halliburton’s experience.

The company’s relationship with Bermuda predates its captive, with existing operations on the island providing a foundation of familiarity and trust. When the decision was made to establish a captive, Bermuda was a natural choice due to that established relationship and the strength of the local ecosystem.

Initially, the captive was used for traditional risk management purposes. However, as the company became more comfortable with the structure, it began to explore additional applications. One of the most significant developments has been the incorporation of employee benefits into the captive.

Operating across a wide range of jurisdictions, Halliburton had identified inefficiencies in how it managed global benefits programmes. By bringing these into the captive, the company has been able to leverage its scale better, improve cash flow and exert greater control over cost volatility.

This kind of expansion reflects a broader trend among captive owners. Once the initial structure is in place and understood, organisations often look to extend its use. That can include adding new lines of business, increasing retention levels or exploring alternative solutions such as parametric insurance.

Bermuda’s role, the panel suggested, is to provide a framework that supports this progression rather than constraining it.

A single regulator... enables a more holistic understanding of how different parts of the market interact and allows for more coordinated oversight

Integration beyond captives

While captives were the focus of the session, the discussion repeatedly highlighted Bermuda’s broader value as a fully integrated risk and capital hub.

Tannock described how her organisation has used its Bermuda presence not only for captive purposes but also as a reinsurance platform within a wider group structure. As Bermuda’s regulatory standing has strengthened globally, other regulators have become increasingly comfortable with Bermuda-based entities.

This recognition has enabled organisations to use their Bermuda platforms to support affiliated operations in multiple jurisdictions. In effect, the captive becomes part of a wider network of risk transfer and capital deployment, rather than a standalone entity.

This is where Bermuda’s ecosystem becomes particularly important. As Gakundi noted, companies operating in Bermuda can establish captive structures while also accessing reinsurance capacity, capital markets expertise and a deep pool of professional services – all within the same jurisdiction.

The proximity of these capabilities is more than a convenience. It allows for faster decision-making, closer collaboration and a more integrated approach to managing risk.

Tannock highlighted the practical implications of this proximity. Reinsurers are often physically located in Bermuda, operating under the same regulatory framework and subject to the same oversight. This alignment reduces friction in transactions and creates a shared understanding of market dynamics.

Expertise and infrastructure 

Another key advantage identified by the panel was the depth of expertise available within Bermuda.

Over decades, the jurisdiction has developed a concentration of specialised knowledge across underwriting, actuarial science, legal services and captive management. This expertise supports not only the establishment of captives but their ongoing evolution.

Companies are able to draw on experienced professionals who understand both the technical and strategic aspects of captive insurance. This becomes increasingly important as structures grow more complex and are used for a wider range of purposes.

The panel suggested that this accumulation of intellectual capital is difficult for newer jurisdictions to replicate quickly. While other markets might seek to attract captive business, building the necessary expertise and track record takes time.

A regulator that engages

At the centre of Bermuda’s proposition is its regulatory framework – and, crucially, the way that framework is applied.

Both panellists emphasised that the BMA’s approach is characterised by engagement and responsiveness. Rather than acting solely as an enforcer of rules, the regulator is seen as an active participant in the market’s development.

This does not mean compromising on standards. Bermuda’s reputation is built on maintaining a high level of regulatory credibility. However, the regulator’s willingness to engage with industry participants allows for a more nuanced approach to emerging challenges.

Tannock noted that when concerns are raised – whether by individual companies or through industry bodies – there is a willingness to listen and to consider how the framework might evolve. This dialogue helps ensure that regulation remains relevant without becoming restrictive.

The presence of a single regulator overseeing insurance, reinsurance and investment funds was also highlighted as an advantage. It enables a more holistic understanding of how different parts of the market interact and allows for more coordinated oversight.

Beyond credibility and flexibility, Bermuda’s ability to deliver outcomes efficiently was identified as a key factor in its continued appeal.

Smallman described the jurisdiction as one where things can be done without unnecessary delay. For global organisations operating in complex environments, this efficiency is critical. It allows them to implement changes, respond to emerging risks and optimise their structures without being slowed by administrative barriers.

This combination of efficiency and expertise creates a practical advantage. Companies do not need to build solutions from scratch or navigate unfamiliar systems. Instead, they can rely on an established market that understands their needs and can support their objectives.

Managing risk in a changing world

The panel also acknowledged that captive owners continue to face significant challenges. These include long-tail liabilities, rising medical costs, geopolitical uncertainty and shifting reinsurance dynamics.

Captives do not eliminate these risks. However, they provide a mechanism for managing them more proactively and strategically.

Bermuda’s role, according to the discussion, is to equip companies with the tools, relationships and regulatory support needed to navigate these challenges effectively. This allows organisations to approach risk management in a structured and deliberate way, rather than reacting to events as they occur.

In closing, Gakundi argued that Bermuda’s success as a captive domicile is rooted in its ability to evolve.

The market has expanded across sectors, structures and use cases while maintaining the core attributes that first made it attractive: expertise, credibility, flexibility and a willingness to engage.

For companies facing an increasingly complex and interconnected risk landscape, these qualities remain highly relevant. The panel’s discussion suggested that Bermuda’s ability to combine tradition with adaptability continues to set it apart as a leading domicile for captive insurance.

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