Apr 2024
The first dedicated reinsurance conference in the Cayman Islands was by every conceivable metric an incredible success. Hosted by CIRCA, close to 450 reinsurance professionals gathered at [Re]Connect to network and hear directly from the Government, regulator, service providers and other stakeholders on Cayman’s growing reinsurance industry.
Conyers’ Insurance team highlights 10 main takeaways from the conference below:
1) Rolling Out the Red Carpet
- Attendees were warmly welcomed to the inaugural [Re]Connect conference by, among others, Deputy Premier and Minister of Financial Services and Commerce André Ebanks and the message was clear: Cayman is rolling out the red carpet for the reinsurance sector.
2) Final Piece of the Puzzle
- Deputy Premier André Ebanks presented delegates with a history of the development of financial services in the Cayman Islands, highlighting that it is a world leader in many financial services sectors including investment funds and structured finance. Building on a decades long insurance industry coupled with the on-going convergence of the reinsurance and investment fund sector, Cayman facilitates a “perfect marriage” of these sectors and, in many respects, this represents the final piece of the puzzle for Cayman in terms of servicing the most sophisticated sectors of the global financial services industry.
3) Proportionate Regulation
- Details on Cayman’s financial services regulation, which has evolved over several decades, were shared with delegates, debunking any impression that Cayman’s regulatory regime is ‘light touch’. The Cayman Islands has a strong and robust framework which meets international best practices but which is implemented in a manner which permits sophisticated and duly approved market participants to operate expeditiously but in a safe and robust environment. By domiciling your reinsurer in Cayman you are participating in an economy which stands up to scrutiny.
4) Trust & Collaboration
- As the Cayman reinsurance industry grows, CIMA needs to continue its efforts to build, expand and embed its relationships with international regulators, supervisory authorities and agencies. Speaker feedback was that as these relationships strengthen and assuming CIMA continues to proactively act and appropriately react, the reward will be increased levels of comfort and trust internationally with Cayman as a reinsurance domicile.
- CIMA is known as an approachable and transparent regulator and is proactive in its communication with US State and other regulatory authorities, evidenced by CIMA having 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 numerous US State Departments of Insurance including Illinois, Florida, Utah and Washington, with others in the works.
5) NAIC Equivalency
- An update on Cayman’s quest to be recognised as a Qualified Jurisdiction (“QJ”) by the NAIC was hotly anticipated and the warmly welcomed feedback to delegates was that Cayman has secured the support of a US state to assist and support Cayman with the application process which is ongoing.
- CIMA has already a strong working relationship with the NAIC, having entered into a Memorandum of Understanding with the NAIC in 2018. Obtaining QJ status is widely considered to be a natural evolution for Cayman’s reinsurance industry which is predominantly US focussed. It was noted that QJ status, if secured, would initially only be of benefit to Class D licensees whom we understand would thereby be permitted, but not required, to seek Certified Reinsurer status with the NAIC permitting them to post reduced collateral depending on the Certified Reinsurer’s financial strength rating.
6) Speed to Market
- Several panellists with established reinsurers in Cayman praised the efficient, interactive and commercial licensing process offered by CIMA. With $360 billion of new annuities written in the US last year, there is a wealth of opportunities for new entrants to the offshore reinsurance market, and Cayman is primed to absorb its fair share of this growth.
- With this in mind, CIMA will need to continue balancing efficiencies in licensing with sufficient rigour to protect the Cayman market and ensure only good actors with a mixture of the right expertise and focus on governance, risk and compliance successfully pass through the CIMA goal posts.
7) Beyond the Boardroom
- During the conference, delegates were treated to sunny days, cocktails by the water and a catamaran sail along the famous Seven Mile Beach – a picture perfect but also accurate taste of Cayman life. The ability to buy property, have a path to citizenship, access to high quality schools, hospitals and restaurants are just some of the lifestyle reasons Cayman is increasingly selected for reinsurers (and their employees) to put down roots. The 25 year work permit available for reinsurance executives is a unique offering from the Cayman government which exemplifies the open arms of the jurisdiction to reinsurance business.
8) Insurtech Innovation
- There was a thought provoking panel discussion which demystified and promoted the Insurtech space in the Cayman Islands. The session had particular focus on, among other items, embedded insurance, which is bringing new and innovative specialty lines into the market place, and why Cayman is well positioned to facilitate Insurtech innovation in the insurance space.
9) Technology Trends
- The efficiencies and advantages to be gained through technological artificial intelligence (A.I.) developments was a strong theme of many panel discussions, with the ability for A.I. to be used to enhance and streamline the initial claims handling experience for both insurers and customers mentioned numerous times – we were informed to watch this space!
10) Season 5 / Branding Enhancement
- For many delegates [Re]Connect was their first visit to the Cayman Islands. As is our usual experience with new visitors, they expressed genuine surprise at the advanced infrastructure, variety of hotels and extensive foodie scene on the Island. Coupling these lifestyle factors with the insights gained on the extent of the financial services industry in Cayman, the quality of its existing stakeholders, the momentum and growth in licensing statistics and the palpable excitement created by the news shared of the jurisdiction’s progress toward QJ status with the NAIC, [Re]Connect succeeded in significantly enhancing the Cayman Inc. brand. We’ve been busy answering calls and emails post [Re]Connect and have no doubt the 2025 iteration of the conference will be even bigger and better. In the words of Deputy Premier André Ebanks, “the time is right now” for reinsurance in the Cayman Islands.
The above are our hot off the press takeaways post [Re]Connect, but we will have more detail and analysis on the above and other items in our Spring edition of “Conyers Coverage”, coming soon!