BMA Sets Out Phased Path to a Bermuda Insurance Resolution Regime

On 15 September 2026, the BMA published a Consultation Paper (CP), “Proposed Phased Introduction of a Resolution Regime for the Bermuda Commercial Insurance Sector“. This is the first phase of a framework designed to align with Financial Stability Board and International Association of Insurance Supervisors standards.

The BMA plans to bring in the regime step by step. This first phase covers three elements; resolution powers, tools and cross-border cooperation are left for later phases:

1. Designating the BMA as the Resolution Authority through an amendment to the Bermuda Monetary Authority Act 1969 (BMA Act), with its resolution function operationally separate from its supervisory role.
2. Establishing five resolution objectives through legislative amendment:
   • Protect policyholders;
   • Safeguard Bermuda’s financial stability;
   • Minimise the use of public funds;
   • Protect client assets; and
   • Maintain confidence in Bermuda’s insurance market and financial system.
3. Defining a targeted scope that covers domestic insurers and Internationally Active Insurance Groups (IAIGs) for which the BMA is the group-wide supervisor. However, the BMA notes that it will retain discretion to include Bermuda insurers that are part of a foreign IAIG or, where appropriate, Bermuda domiciled commercial insurers. This will be enacted through an amendment to the Insurance Act 1978 (Insurance Act).

Not every covered insurer will automatically need a resolution plan under the CP. The BMA will decide based on an insurer’s nature, scale, complexity, substitutability and interconnectedness. For insurers that meet the scope criteria, resolution planning is likely to become a live supervisory issue, building on the BMA’s existing provisional liquidation regime and recovery-planning framework.

The consultation runs until 15 December 2026. In the meantime, the proposals raise a few practical points:

• Scope drives exposure: Whether an insurer counts as a domestic insurer or an IAIG will determine whether it is caught by the resolution requirements, and the BMA’s discretion to bring in other “critical” entities means that scope could widen.
• Recovery plans gain new weight: Plans already prepared under the Insurance (Prudential Standards) (Recovery Plan) Rules 2024 are likely to feed directly into resolution readiness.
• Governance split affects accountability: Keeping the BMA’s supervisory and resolution functions separate should give the resolution function more independence and let it move faster if a crisis hits.

This first paper lays the groundwork for Bermuda’s resolution regime: who will run it, what it must achieve, and which insurers it covers. Powers, tools and cross-border arrangements come later. Over the next few months, expect:

• Stakeholder comments on the CP before the consultation closes on 15 December 2026;
• The BMA’s response paper and proposed amendments to the BMA Act and Insurance Act; and
• The next consultation phase on resolution powers, tools and cross-border cooperation.

For further information on the proposed resolution regime and its potential impact on your business, please contact a member of the Appleby team.