The Bermuda Monetary Authority (the BMA) has recently published a consultation paper (the Paper) outlining proposals on how it intends to enhance its disclosure and transparency regimes.
Initially the proposals are intended to apply only to Class 4 and Class 3B insurers and reinsurers due to their complex risk profile, however further consultation is expected and the BMA may extend certain requirements to Class 3A license holders if it would be proportionate to do so.
The Paper proposes that changes to the disclosure regime should take place in three phases:
- Phase 1 will cover reporting periods 2009 – 2011. In this first phase, the BMA will seek to enhance and standardize regulatory disclosures on risk management, governance and related financial information to provide a more complete understanding of insurers’ risk characteristics or risk profiles.
- Phase 2 will cover reporting periods 2012 – 2014 and will be dedicated to public disclosures, in particular requiring public disclosures that would achieve broadly equivalent outcomes as that under Solvency II implementation in the EU.
- Phase 3 will cover reporting periods 2015 and beyond and will be a transitional period with additional disclosures determined through the BMA's observance of international standards and market consultation at that time.
The BMA intends to require insurers and reinsurers to submit their disclosures to the BMA, which in turn will publish the information on its website.
Stakeholders are invited to submit their views by 31 August 2009.