Part and parcel of practising law in the Cayman Islands regularly involves dispelling commonly held but mistaken myths around Cayman as an international jurisdiction. One such misconception which inexplicably persists in some quarters is that the Cayman Islands Monetary Authority (“CIMA”) as a regulator is a closed shop. Whether this view stems from publicity on Cayman’s grey-list status with the FATF (positive news on that in “Announcements” below), or old tropes in respect of the lack of transparency in the Cayman Islands, it couldn’t actually be further from the truth. CIMA has demonstrated itself to be an approachable, commercial regulator and is always willing to engage with potential entrants to the Cayman Islands insurance industry and overseas regulators.

CIMA was created by the Cayman Islands Government pursuant to the Monetary Authority Act (as revised) (“Monetary Authority Act”) to regulate and supervise the Cayman Islands’ financial services industry. The Monetary Authority Act lists the provision of assistance to overseas regulatory authorities (“ORA”) as one of CIMA’s principal functions. Such international cooperation takes place through the exchange of information, as provided for in the law and facilitated through memoranda of understanding and similar agreements, as well as through CIMA’s active participation in international forums and initiatives.

CIMA is represented in various international bodies including in the insurance sector, namely the International Association of Insurance Supervisors (IAIS) and the Group of International Insurance Centre Supervisors (GIICS). In late May 2023, CIMA hosted the GIICS here in Cayman, which includes a greater part of the offshore electorate for the International Association of Insurance Supervisors (IAIS), including the Bermuda, BVI, Guernsey and Jersey regulators, amongst others, and our very own Derek Stenson spoke at the conference.

CIMA is also party to the IAIS Multilateral Memorandum of Understanding, a framework that establishes a formal basis for global cooperation and information exchange among insurance supervisors. The Cayman Islands is a member of the Caribbean Financial Action Task Force (CFATF) of which it is currently the Chair, an organisation of states and territories of the Caribbean basin which have agreed to implement common counter-measures against money laundering and terrorism financing. CIMA’s participation seeks to ensure that the Cayman Islands is kept abreast of the developments affecting offshore centres and that the jurisdiction plays an active role in international regulatory developments.

The Regulatory Handbook also sets out the criteria for CIMA to enter into a memorandum of understanding with an ORA, being statements of intent setting out the terms and conditions of information exchange and investigative assistance between regulatory authorities. Under the Monetary Authority Act, CIMA can enter into memoranda of understanding with other overseas regulatory authorities to facilitate information exchange and other assistance between the Authority and these bodies. To date, CIMA has entered into 58 bilateral agreements and 8 multilateral agreements with regulatory authorities in the Caribbean, Asia, Europe, Middle East, United Kingdom, United States of America and Canada. Notably, Memoranda of Understanding have been entered into with the National Association of Insurance Commissioners (“NAIC”) and numerous US State Departments of Insurance including Illinois, Florida, Utah and Washington.  Memoranda of Understanding reached between CIMA and other regulatory bodies can be viewed in full here: https://www.the Negotiations with other overseas regulatory authorities are ongoing.

The stability and confidence in CIMA and the Cayman Islands insurance regulatory environment is further evidenced by numerous US state regulators permitting the cessions of large blocks of business directly to Cayman reinsurers. Recent examples include the cession of risk direct to Cayman reinsurers with the consent of the following US state regulators, to name a few: Vermont, Utah, Iowa, Connecticut, Nebraska, Illinois, Tennessee, Hawaii, Puerto Rico and Oklahoma.

We hope the above cliff notes provide good food for thought when you are next probed on CIMA and its role in the international regulatory landscape and affirms CIMA’s status as a co-operative, pro-active and transparent regulator.

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