2 February 2015Cayman analysis

Cayman enacts new insurance regulations

The Cayman Islands has enacted regulations aimed at enhancing the Island's insurance statutory framework and providing more flexibility for insurers.

The regulations will provide alternatives to risk management by enabling insurers incorporated as segregated portfolio companies (SPCs) more flexibility.

The Insurance (Portfolio Insurance Companies) (PIC) Regulations 2015 were passed on January 16, 2015, along with related sections of The Insurance (Amendment) Law 2013.

According to the  Insurance Managers Association of Cayman (IMAC), the legislation is more robust than the incorporated cell company (ICC) structures offered in other jurisdictions.

A SPC insurance company will be able to incorporate one of its cells by establishing a PIC under it. Once the PIC is registered with the Cayman Islands Monetary Authority (CIMA), it may write insurance business in its own name, as a separate legal entity – an exempted company limited by shares.

Kieran O’Mahony, chairman of IMAC, said: “The Cayman Islands have always positioned itself as being a centre of innovation and of creating an environment that carefully considers market needs balanced with good governance.

“The PIC legislation and accompanying regulations both exemplifies and reinforces Cayman’s leading position over other jurisdictions in terms of sensible and proportionate regulation, innovative legislation (based upon a trustworthy and reliable legal system) and the high level of governance and compliance afforded to it."