The Cayman Islands Monetary Authority (CIMA) has recently taken further steps to streamline applications for Catastrophe Bond Vehicles (Cat bonds) of Class ‘C’ insurers. This new regime will also make the registration timeframe more efficient, and ultimately, the Cayman Islands will uphold its reputation as a competitive jurisdiction.
Effective 6 February 2017, non-complex Cat bonds applications can now be approved at a divisional level by the Authority’s Insurance Supervision Division. This will allow the licensing to be completed within 5-10 business days.
Previously, all applications were approved during the Authority’s weekly Management Committee meetings.
The Class ‘C’ licence category under the Insurance Law captures entities that provide reinsurance through the issuance of insurance-linked securities (ILS) such as Cat bonds, sidecars, collateralised reinsurance or similar instruments.
The division has also been given the power to approve ‘renewals’ of analogous Cat bond licenses within 5-7 business days. The issuance of licenses at a divisional level is not new to the Authority. Currently, all funds licenses and registrations including portfolio insurance companies are issued at the divisional level.
In conjunction with these recent changes, a new standalone licensing policy for the Class ‘C’ insurer category will also be developed. This will clearly outline the criteria and procedure for issuing such licenses, and help to mitigate any associated risks.
CIMA’s Managing Director, Mrs. Cindy Scotland said, “This fast-track licensing process is another testament towards CIMA’s efforts in accommodating sophisticated solutions within the financial industry, while maintaining our obligation as a regulator.”