The Bermuda Insurance Management Association plays a key role in protecting the interests of its members and helping promote both Bermuda and the captives industry generally. Grainne Richmond, its new president, has some additional aims, as she explains to Bermuda Captive.
In April 2016 Grainne Richmond, vice president of Dyna Management Services, took over as president of the Bermuda Insurance Management Association (BIMA), the association of professional insurance managers and other captives service providers in Bermuda, replacing Robert Paton, who served as president for the previous two years.
Prior to taking the presidency of the body, she had been its secretary for five years and vice president for a year before that.
The office of president is currently a two-year term and this term has worked well for the organisation to date.
Richmond says her role, and the role of BIMA in a broader sense, can be viewed as two main functions: to protect the interests of its members by liaising with government and other organisations both in Bermuda and abroad; and to encourage professionalism and continued education in the industry.
“THERE IS A LOT OF YOUNG TALENT OUT THERE WHO HAVE THE ABILITY TO BRING A FRESH ENERGETIC AND DIFFERENT PERSPECTIVE TO THE BERMUDA CAPTIVE INDUSTRY.”
For the coming two years Richmond has set herself some extra objectives.
“A key one of these is to engage with young professionals in the industry and encourage them to participate more in the industry bodies,” she explains.
“When I started working in the captive industry in Bermuda I benefited from exposure to industry organisations and meetings being held which addressed topics being dealt with by the industry, government and the regulator.
“Over the next two years I aim to reach out to those either starting in the industry or who have been in the industry for a while but who are not involved in the industry organisations, and encourage them to become more involved, participate and expand their knowledge overall.
“I firmly believe there is a lot of young talent out there who have the ability to bring a fresh energetic and different perspective to the Bermuda captive industry,” she says.
“In the next few months I will be engaging with individuals, in captive management and other service firms, who are not necessarily the most senior people in their respective organisations but who have the potential to represent the next generation of captive professionals, and I know I have a lot of support from current industry experts who have a wealth of knowledge, experience and wisdom,” she adds.
Richmond further states that an issue for any business in the world today is that of proper succession planning and continuity. BIMA has identified that while there are a lot of young, bright, professional people in Bermuda the organisation may have been lax in engaging with them.
“To maintain our global reputation in providing high quality service, providing a superior product and retaining people with a wealth of experience we need to ensure stability in the talent and workforce in our industry,” she says.
In parallel with this, Richmond will be working with BIMA and professional service firms in Bermuda to connect with schools in Bermuda to educate young people about the career opportunities available in the captives industry.
“The commercial space has done a great job of getting their message across to the young and upcoming talent of the opportunities in their sector. Unfortunately we have been somewhat slow on this on the captive side.
“We are the leading insurance domicile and the students growing up here hear a lot about the commercial or alternative insurance industry, but less about the captive space, which can offer a very stable career path and travel opportunities” Richmond says.
Working with regulators
Arguably the most important role of BIMA in recent years has been to liaise with government and regulatory bodies. The association meets with senior Bermuda Regulatory Authority (BMA) representatives on a quarterly basis to discuss any potential legislative changes, initiatives, policies and reporting requirements that could have an impact on the captives industry.
The collaboration between industry and regulator was very evident during the process Bermuda worked through on achieving the status of ‘bifurcated equivalence’ with Europe’s Solvency II regime.
“One example of such collaboration that comes to mind was back in 2010, when Karl Van Hulle, the now retired head of the insurance and pensions unit of the EU, invited representatives from the captive industry to meet with the European Insurance and Occupational Pensions Authority (EIOPA) to discuss Solvency II and captives,” Richmond recalls.
“A meeting was held in Brussels between EIOPA representatives, BIMA representatives Tom McMahon, Lawrence Bird and Kathleen Bibbings, and BMA supervisor Shelby Weldon.
“The focus of the meeting was to further inform EIOPA on the different class structure applied to Bermuda captives and to clarify the limited purpose and nature of the Bermuda-licensed captive insurers. It was very beneficial and worthwhile that the BMA and industry accepted this invitation from EIOPA and the meeting was an important stepping stone to bifurcated equivalence.”
She further states that it is this proactive approach by Bermuda and the BMA that has ensured the successful outcome on their Solvency II equivalence.
“Solvency II equivalence was a long process but Bermuda, I believe, has ended up with the best of both worlds. It was a lengthy process, requiring a lot of collaboration and education, and to this end BIMA would like to congratulate the BMA on its achievement.”
More recently, BIMA has also played a key role in the introduction by the Bermuda regulator of a new electronic filing system for captives. Richmond says the system has been broadly welcomed by BIMA members following trial runs performed in 2014 and 2015 and becomes effective for those filing returns on their 2016 numbers.
“We understand that the e-filing system will enable the BMA to review and monitor captives more efficiently and effectively and it will certainly make collection of statistical data more accurate and more efficient,” she says.
“Managers understand that there will be an element of learning in the first year of processing returns electronically, but it is a process I am sure the managers will adapt to very quickly and understand the benefits this brings to the industry for the future.”
The other role of BIMA is to promote Bermuda as the number one domicile of choice for owners and stakeholders to establish a captive. BIMA partners and works very closely with the Bermuda Business Development Agency (BDA) to boost the profile of the Island overseas and to promote the captives industry specifically.
There has been a big push in recent years to target specific markets including Canada and Latin America. Roadshows to these places have resulted in an increase in formations in 2015 compared with 2014 with a steady pipeline starting to come through from these regions in early 2016.
Richmond says success in a specific market does not happen overnight and involves a process of imparting knowledge, education, marketing and more education.
“Ross Webber, CEO of the BDA, has put together a very energetic, enthusiastic and knowledgeable group of young people who work with BIMA on an ongoing basis to ensure the focus of growth for the captive industry is getting the support it requires.
“There is an upward trend from Canada and Latin America and there will continue to be more opportunities. We always work to do our best to ensure we are first out of the gate to take advantage of new opportunities which starts with informing those involved and ensuring they understand the benefits Bermuda offers.”
She further states that contrary to popular belief there are still great opportunities for growth in the US market, specifically the healthcare sector where great change has been prompted by Obamacare and more healthcare bodies are considering self-insurance.
“It is an incorrect conception to say that the US market is exhausted or fully matured,” Richmond says.
She further explains that the healthcare sector is changing rapidly, leading to mergers and acquisitions of healthcare institutions and organisations, the result being new formations or consolidation of existing captives, sometimes from different domiciles. “To date we have seen a trend of the Bermuda entity being the domicile of choice for these merging captives,” she adds.
It is not all smooth sailing, Richmond admits, and for any industry to remain successful and relevant it must address the threats that are out there. She says that one of the potential threats Bermuda faces is around the perception of the Island when it is incorrectly labelled a tax haven.
“There is a global perception problem that offshore classification instantly means non-transparent, illegal or a tax haven,” she says. “Hats off to Ross Webber and the BDA who are working hard to dispel such misinformation, but it is an ongoing information campaign that we all need to participate in.
“The captive industry is incredibly transparent and we adhere to all relevant regulations, but at certain times, such as during US elections and other global political posturing, we can still come under attack as the idea of offshore domiciles becomes part of the political rhetoric.”
To this end BIMA is committed to playing its part in ensuring a bright and long future for the Bermuda captives industry, and Richmond as president looks forward to leading the organisation over the next two years, engaging with other experienced industry professionals and collaborating with domestic and global industry bodies.
Grainne Richmond is vice president of Dyna Management Services and president of the Bermuda Insurance Management Association. For more information visit www.bima.bm
About the BIMA
Established in 1977, the Bermuda Insurance Management Association (BIMA) has been at the heart of the development of the re/insurance industry on Bermuda from its roots and humble beginnings through waves of innovation and growth to its emergence as the domicile of choice for many classes of business.
Since its formation, BIMA has represented the insurance management community and has played an important role in the evolution of the regulatory environment which governs and protects the captives industry in Bermuda. As well as liaising with government, it offers a unified approach to problems that may be of concern to its members.
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