The final day of the Captive Insurance Companies Association (CICA) 2013 International Conference kicked off with a session on the changing regulatory environment. It focused on the potential changes that may be imposed on US accounting, financial and regulatory standards by the actions of the International Association of Insurance Supervisors and other international bodies.
The session delved deeper, attempting to understand complications arising from tensions between state and federal regulatory actors and the potential impact on captives.
Moderating the session was Robert Myers of Morris Manning & Martin LLP, with speakers Tom Finnell of the US Department of the Treasury's Federal Insurance Office (FIO), Debbie Lambert of Johnson Lambert LLP and Shanna Lespere of the Bermuda Monetary Authority.
Myers explained that tensions between the National Association of Insurance Commissioners and the FIO have arisen because the former has been around for some time while the latter is a new kid on the block. An upcoming FIO study will have a point on captives, but it isn’t clear “whether it is going to be benign or malignant”.
Although the speakers focused on the finer points of regulation, attendees drew their attention to the costs that they incur. After some awkward laughter and Myers saying that “nobody wants to answer that question”, Lespere chose to take a stab at it, while staying "politically correct".
Lespere said that while she and others are paying attention to costs, the captive insurance industry must remember that the frameworks that are in place are important in insuring that regulators globally are moving towards a mutual territory in terms of compliance with standards. She added: "There are [also] a lot of benefits that are sometimes unseen.”
