A prevailing view that new economic substance regulations will have minimal impact on captive insurers in Bermuda is to come under closer consideration next week.

An expected 800 delegates and speakers will attend the Bermuda Captive Conference, and the topic of economic substance and how it might impact the sector will be discussed.

“Economic substance is very topical. We have a panel of three people talking about it,” said Michael Parrish, chairman of the conference.

Bermuda has grappled with the issue of economic substance since the European Union raised concerns last year, and earlier this year it was temporarily placed on the EU blacklist of noncooperative jurisdictions due to a typographical error in its economic subsistence regulations. The mistake was corrected and the island is no longer on the list.

The island has more than 700 captive insurers, who directly employ upwards of 550 people in Bermuda. The sector annually contributes an estimated $174 million into the economy.

At next week’s conference, a panel will explore and answer questions related to the Economic Substance Act, and address key requirements that may apply to captives, and discuss how Bermudian-based service providers support captives and their owners in demonstrating Bermuda substance.

One view is that economic substance legislation will not impact the captive industry, to the degree that captives compliant with the Insurance Act and Companies Act are deemed to be compliant under the economic substance legislation. However, Mr Parrish cautioned that view has not been endorsed by anyone.

The three-day conference at the Fairmont Southampton starts on Monday. One session will look at emerging issues, including the shared economy, autonomous driving, terrorism and cybersecurity, which fits with the conference’s 2019 theme of “elevate”.

Mr Parrish said: “The idea is to get people to elevate their thinking, to move away from thinking that captives are just a mechanism for traditional property and casualty risk, [and] to move on to other things, such as developing areas — cyber, employee benefits, autonomous vehicles, and crypto commerce.”

While the captive market in Bermuda, and generally, has not grown notably in terms of captive numbers in the past year, premiums have increased, and captives are being used in more areas.

Mr Parrish said: “We have seen new developments for crypto commerce. We have seen a captive being set up in Bermuda for digital assets, covering a digital asset deposit taker. That’s a crypto captive, probably the first one.

“That is going to be a developing area. It’s an area where people in that industry find it very difficult to buy traditional insurance. There are traditional insurance companies that don’t like insuring that industry because it is so new and a lot of the companies are start-ups and do not have track records.”

The Bermuda Captive Conference is marking its fifteenth year. It is the biggest industry conference held on the island, and about half of attendees come from overseas.

This year, as part of a sustainability drive, the event will introduce water stations allowing delegates to refill water bottles. Mr Parrish said he attended a large overseas conference and calculated that thousands of complimentary plastic water bottles ended up as trash after each was used only once.

A number of innovations introduced at the conference last year will continue, including the improved layout of the exhibition hall and more functionality in the mobile app that gives opportunities for networking among delegates, and proving live feedback during sessions.

As part of its outreach, the conference is encouraging some high school and Bermuda College students to come along, particularly to parts of the programme where they can connect with panels discussing opportunities for jobs in the sector, especially for young people.

A charity programme that debuted last year, is back. This time Big Brothers Big Sisters will be supported and have the opportunity to secure a presence at the event.

Keynote speakers are Tripp Crosby and Jeremy Cox.

Mr Crosby is a well-known YouTube comedian whose business-related material includes the video sketch A Conference Call in Real Life.

While Mr Cox is the executive chairman of the Bermuda Monetary Authority. Mr Cox will also receive the fourth Fred Reiss Lifetime Achievement Award.

In addition, four captive insurance companies will join the Bermuda Captive Hall of Fame, having completed 25 years of business on the island. The companies are Fairtide Insurance, Iboba Insurance, Pitts Bay Insurance Company, and Trimark Insurance.

“We salute these companies and their longstanding commitment to our market,” Mr Parrish said.

This is his second year as conference chairman. He said: “It’s been a very good experience. There is a committee that frankly does all the work. This is the fifteenth year of the conference and there are people involved who have been here for every one.

“The chair just needs to make sure that all the moving parts come together on the day. It’s a great event, and it is testament to the influence and importance of the captive industry to Bermuda.”

• To register for the conference, or for more information, go to http://bermudacaptiveconference.com or contact The Whitfield Group at events@bermudacaptiveconference.com or call 292-6386