The Cayman Islands Monetary Authority (CIMA) issued eight new insurance licenses in the third quarter. The rate of licensing activity, which remained similar to the first two quarters of the year showed “continued interest in Cayman’s captive insurance industry, which has maintained a strong position”, the Insurance Managers Association of Cayman (IMAC) said in a press release.
The new third-quarter licenses included five class B(i) licenses, three class B(iii) and one new portfolio insurance company.
At the end of the quarter there were 679 class B, C and D insurance companies licenced in the Cayman Islands, writing approximately US$57 billion in premiums and with total assets of US$137 billion.
The numbers were consistent with Cayman’s position as the second largest captive insurance domicile globally and have increased in the past two years, notably with premiums up from US$23 billion and assets rising from US$75 billion in 2021, IMAC said.
CIMA issued a total of 24 international insurance licenses during the first nine months.
IMAC said given that the fourth quarter is traditionally a busy period for new licencing activity and the majority of Cayman insurance managers continue to report healthy new business pipelines, 2023 is likely to be another buoyant year for the jurisdiction.
In each of the last seven years, Cayman added more than 30 new international insurance licenses.
Lesley Thompson, chairperson of IMAC, said, “Thanks, in part, to CIMA’s proportional regulatory approach, the Cayman Islands insurance industry is experiencing continued growth across sectors, with established companies expanding their portfolios and group captives welcoming new members.
“These healthy third quarter statistics signal the likelihood of a strong finish to the year and we expect to see increases in license applications and double-digit license issuances in Q4.”
Licensing activity in 2023 included five new portfolio insurers and one class D open market reinsurer.
Cayman’s portfolio insurance company legislation allows insurance companies established as segregated portfolio companies to incorporate cells as portfolio insurance companies, IMAC said. This has been a popular way for industry participants to enhance risk management.
The reinsurance sector has also developed into part of Cayman’s international insurance business in recent years. There are currently eight class D licensed reinsurance companies, compared to three in 2017.
North America continues to be the dominant risk location for the Cayman Islands international insurance industry, accounting for 90% of the total in Q3 2023.
Medical malpractice liability, workers compensation, general liability and property remain the most significant lines of business, together making up almost 70% of licensees.
IMAC encourages anyone who would like to learn more about Cayman Islands captives to register for this year’s Cayman Captive Forum, held at the Ritz Carlton from 28 to 30 November.