Tim Faries (TF): The first element that I would mention is the breadth and depth of the support infrastructure on the island. Bermuda was a first-mover in the captive industry, around 50 years ago, and since this time it has been able to establish a unique environment here. The island possesses a host of experienced captive managers, lawyers, accountants and other essential service providers that captive owners require to keep up with the day to day running of their captive. In Bermuda, we have all of the amenities of captive upkeep with extensive experience of operating in all areas of captive maintenance and working with a multitude of different risks through captives.
The second element that separates Bermuda from other domiciles is the existence of the island’s reinsurance markets, which have developed alongside our captive market for a significant amount of time. It is albeit not as old, but the Bermuda reinsurance market has existed for 25 to 30 years and consists of a number of carriers who will write reinsurance for captive programmes. A captive owner can come to Bermuda for the annual meeting of the captive, and take care of its renewal as well. This is a benefit that no other captive domicile can provide to the same degree. The existence of a market to retrocede your captive risks to Bermuda, is attractive for efficiency purposes.
Finally, the regulatory environment plays an instrumental part in separating Bermuda from the competition. Our insurance laws and regulations were designed for captives back in 1978. Our regulators understand the importance of the captive industry to Bermuda’s economy and have made it a priority to be accessible to captive owners to discuss issues relating to their supervision. This enhances the efficient operation of captives in Bermuda. The island’s regulators and legislators have worked in unison with the industry to ensure that the regulatory oversight and infrastructure for captives is cutting edge in terms of global standards. That process has produced a regulatory environment that has been copied by some of our competitors, and I believe that it is always the case that the copy is never quite as good as the original.