05-Nov-2012

NEW INSURANCE LAW COMES INTO FORCE

George Town, Grand Cayman, 5 November, 2012

The Cayman Islands Insurance Law 2010 went into force 1 November 2012 after an order made in Cabinet earlier in the week. The latest amendments to the law were based on recommendations from a public/private sector Insurance Working Group and the International Monetary Fund.

The aims of the law were to clearly differentiate between the domestic and international insurance markets in Cayman and to regulate each in accordance with its requirements; to strengthen legislation to protect Cayman residents; to bring the law, formally, into line with international standards; and to open new markets for new business sectors.

The law achieves these objectives by positioning Cayman to take advantage of new opportunities in the insurance industry, in particular the growing insurance-linked securities (ILS) and the reinsurance sectors. This has been accomplished through addressing both the regulatory function and streamlining immigration policy so as to increase physical presence in the Cayman Islands.

By taking into consideration the International Monetary Fund recommendations, this new law brings Cayman to the fore in terms of international regulatory requirements for insurance by clarifying and in some cases expanding the Cayman Islands Monetary Authority’s scope of supervision and its powers of enforcement, while still maintaining the risk-based philosophy that has made Cayman a successful domicile for international insurance.

The amendments to the law also address immigration policy designed to attract new business to the Cayman Islands, including the availability of ten-year work permits for executives and managers in the Cayman reinsurance industry and free work permits for various categories of professional staff for their first five years of residence in the Islands. In addition, Permanent Residence with the Right to Work is now available to approved persons who make a substantial investment in a home or other real estate.

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