The Bermuda Monetary Authority (BMA) proposes expanding the scope of its Conduct of Business framework to cover all insurers writing retail business directly to individuals, wherever those policyholders are located, as part of a wider consultation package addressing investment governance and group supervision. The proposal forms part of a consultation paper issued on 9 June 2026, alongside a finalised stakeholder response on the Prudent Person Principle (PPP) and illustrative draft amendments to the island's group rules. Comments on the consultation are to be received by 27 July 2026. Under the current framework, conduct of business provisions embedded in the Insurance Code of Conduct in 2022 apply only to insurers writing domestic retail business. The BMA now proposes extending these to all Bermuda-registered insurers selling insurance products designed for and bought by individuals, regardless of whether the policyholder is based in Bermuda or overseas. The expansion does not capture foreign affiliates of Bermuda registrants or insurance groups. The regulator says the change is intended to limit risks to individual policyholders located internationally and to provide them with the same protection afforded to domestic retail policyholders. In-scope insurers will have 180 days from final publication of the Code to comply. The BMA also publishes its response to feedback received on its December 2024 consultation on the Prudent Person Principle, confirming consequential amendments to the Code and the Insurance (Group Supervision) Rules 2011. The principle requires that an insurer assume only investment risks it can properly identify, measure, monitor, control and report on, taking account of its capital, liquidity and policyholder obligations. The Authority says the enhancements respond to a rise in non-publicly traded, illiquid, less transparent, structured and related party-originated assets across the sector, particularly among long-term insurers. It confirms that reliance on Generally Accepted Accounting Principles (GAAP) alone would not demonstrate compliance with the PPP, which it says goes beyond the scope of GAAP. Responding to industry calls for proportionality, the BMA says compliance with the principle continues to be assessed on a case-by-case basis relative to an insurer's nature, scale and complexity. It declines to introduce a separate regime for the property and casualty sector, noting the principle does not distinguish between industry sectors. In-scope insurers are required to comply with the Code amendments by 31 December 2026. The package also advances enhancements to the group supervision framework, with consequential amendments to the group rules and group solvency rules set out in illustrative draft form. These follow amendments to the Insurance Act 1978 made in late 2025, which took effect on 7 January 2026, and introduce provisions relating to designated insurance holding companies. The group supervision amendments come into operation 180 days from publication of the draft rules. An accompanying guidance note sets out the BMA's expectations on investment strategy, asset-liability matching, risk concentration, complex and non-publicly traded assets, affiliated party exposures and the use of derivatives. The guidance enters into force on publication. Bermuda is the world's leading captive insurance domicile, and the conduct, investment and group supervision standards the BMA sets apply across the island's insurance market, shaping the environment in which captive and commercial insurers operate. The consultation documents are available via the BMA's documents centre.
