The Bermuda Insurance Act 1978 establishes a framework for regulation of the industry here. Oversight is provided by the Bermuda Monetary Authority, the island’s financial regulator.

Section eight of the Act enables the BMA to maintain close oversight of insurance entities, ensuring that they operate transparently and accountably, by establishing clear requirements for principal offices, principal representatives, and notification procedures.

That section codifies a crucial role by outlining the requirements for insurers, insurance managers and intermediaries to maintain a physical presence and designate key individuals responsible for regulatory compliance.

This physical presence and designation of key individuals enables the BMA to closely monitor the activities of insurance entities, ensure compliance with regulations, and protect the interests of policyholders and other stakeholders.

The section requires every entity regulated under the Act – including insurers, insurance managers, brokers and intermediaries – to maintain a principal office in Bermuda.

This requirement mandates the establishment of a physical location for each registrant within the jurisdiction, facilitating communication and interaction with the BMA.

It demonstrates a commitment to operating within the regulatory framework and being accessible to the BMA.

The principal representative, a statutory function-holder as prescribed by the Act, plays a key role in ensuring an insurer’s compliance with the Act, which requires them to be resident in Bermuda, a person of utmost integrity, and possess a strong understanding of insurance laws and regulations.

For insurers specifically, section eight mandates the appointment of a PR in Bermuda who acts as a key liaison between the insurer and the BMA, assuming significant responsibilities in ensuring compliance with the Act and regulations.

The PR must be approved by the BMA, meeting specific criteria set out by the regulator, demonstrating the importance placed on this role and ensuring that the individual possesses the necessary qualifications and experience to fulfil their responsibilities effectively.

Insurers should promptly notify the BMA and their designated supervisor of any changes to their principal office or PR immediately, followed by a formal written confirmation submitted within 14 days.

Upon registration, insurers are required to submit a written notice to the BMA, formally notifying them of the location of their principal office, which can be the office of the director or manager or the insurance management company.

Insurers also need to notify the BMA about the particulars of its PR, including details such as name, qualifications and contact information.

Examples of changes that need to be reported include a change of address for the principal office, the appointment of a new PR, or any modifications to the PR’s contact information.

Section eight prohibits the termination of a PR or their resignation without a justifiable reason acceptable to the BMA, such as retirement, serious illness, or a change in the insurer’s ownership structure.

Both parties must provide 30 days’ written notice to the BMA of their intention to terminate the appointment or cease acting as a PR, allowing the BMA to stay informed of leadership changes and ensure a smooth transition.

PRs have an obligation to report certain events to the BMA in writing within 14 days, such as the insurer’s likelihood of becoming insolvent, failure to comply with conditions imposed by the BMA, involvement in criminal proceedings, or cessation of insurance business in or from Bermuda.

The section specifically provides that a PR who willfully fails to provide the required notification regarding termination of appointment, cessation of their role, or any reportable events, commits an offence.

Offences under section eight may result in fines, imprisonment, or both, depending on the severity of the violation and its potential impact on the insurance industry and policyholders.

As the island’s insurance landscape continues to evolve, section eight’s effective regulation will remain critical in maintaining a robust and well-functioning industry in Bermuda.

First Published in The Royal Gazette, Legally Speaking column, May 2024

Share
X.com LinkedIn Email Save as PDF
More Publications
Appleby-Website-Privacy-and-Data-Protection
28 Jul 2025

Insights from the BMA’s Second Consultation Paper on Digital Identity Service Providers

As jurisdictions around the world grapple with the complexities of authenticating digital identities...

Technology and Innovation
24 Jul 2025

Contracts to Manage AI Risk: Part Two (Bermuda)

In part one of this two-part series about artificial intelligence contracts, I discussed the ways th...

Technology and Innovation
22 Jul 2025

Contracts to Manage AI Risk (Bermuda)

This is the first of a two-part article on how artificial intelligence contracts can be used to mana...

Appleby-Website-Insurance-and-Reinsurance
15 Jul 2025

Captives are the grass roots of Bermuda risk

Bermuda has seen tremendous growth in the life reinsurance and insurance-linked securities markets i...

050-Insolvency-Restructuring-Grid-Image
10 Jul 2025

Bermuda: Restructuring & Insolvency

This country-specific Q&A provides an overview of Restructuring & Insolvency laws and regulations ap...

050-Insolvency-Restructuring-Grid-Image
3 Jul 2025

Insolvency law: secured creditors take note (Bermuda)

The recent judgment delivered by the Supreme Court of Bermuda in the matter of Harold J. Darrell hig...

Appleby-Website-Insurance-and-Reinsurance
2 Jul 2025

Bermuda: Education has helped investors get more comfortable as ILS continues to grow

It’s been an exceptionally busy and record first half of the year for the catastrophe bond sector,...

Appleby-Website-Privacy-and-Data-Protection
25 Jun 2025

Impact of Privacy Law on Bermuda Business

On 1st January 2025, Bermuda’s Personal Information Protection Act 2016 (PIPA) came into full forc...

Appleby-Website-Regulatory-Practice
25 Jun 2025

Simplified Due Diligence in Bermuda

Simplified Due Diligence (SDD) and Reduced Due Diligence (RDD) are critical features of a modern, ri...

Appleby-Website-Employment-and-Immigration
23 Jun 2025

Practical Tips for Conducting Workplace Investigations

Allegations of harassment, bullying or other misconduct in the workplace can create a legal mine fie...