The Isle of Man’s government has launched new legislation that will allow the establishment of Insurance Special Purpose Vehicles (ISPVs).
This legislation has been designed specifically to facilitate insurance-linked securities (ILS) and similar transactions including catastrophe bonds, mortality bonds, sidecars and industry loss warranties, as well as other collateralised reinsurance structures.
John Garland, head of corporate financial services with the Isle of Man government’s Department of Economic Development, said: “We have been working and consulting closely with industry and the Insurance and Pensions Authority on introducing this legislation and already have enquiries in the pipeline.”
“We believe that our framework for ISPVs offers excellent features for potential users as well as the proportionate and focused legislation that we are renowned for.”
The island’s government has stated that the licencing process is designed to take just five days following receipt of fully prepared applications.
Garland continued: “We can also offer a highly competitive fee structure—that may be fixed for the lifetime of any ISPV with a determinable lifespan—along with simplified regulatory requirements, including returns.”
Simon Nicholas, partner at KPMG Isle of Man and deputy chair of the Isle of Man Captive Association commented: “ILS is a very exciting and fast evolving area of insurance and the Isle of Man legislation has been market tested by several global well respected players in the ILS market, including some of those who already have a presence on the Island.”
“With a promising pipeline, we expect this to complement the Isle of Man’s already successful and diverse financial services industry.”
