Insurance companies are soon to be subjected to more regular financial checks, Bermuda?s insurance regulator says, under an Insurance Act amendment due to be considered by legislators as early as this summer.

The change will shift the focus from initial scrutiny of each insurer when it forms, to a more periodic review process. The scheme will apply to most of the Island?s more than 1,200 insurers, according to plans put on the table by Supervisor of Insurance Jeremy Cox.

Mr. Cox, named Supervisor when insurance regulation was moved under the Bermuda Monetary Authority in 2002, said that existing legislation ?speaks to the fitness and propriety of (a company) on day one. We want to regularise that process, and we are going to set a minimum criteria?.

The change is in keeping with the Island?s increasing prominence as an insurance and reinsurance domicile, he said, with the combined capital of the market now in the region of $100 billion.

?The informed market person realises that a successful market can only continue to be successful if it is reinforced by solid regulation,? said Mr. Cox, in an interview earlier this year.

The latest changes to Bermuda?s insurance law comes on the heels of the BMA?s insurance division already, in the last year, stepping up its review process for the company?s largest insurers, or those referred to as ?class four? companies under the Island?s licensing scheme.

?What we have done for the high-end commercial sector, is that we now have on-site reviews,? Mr. Cox said. ?We are committed to having these reviews every other year? or more frequently if a company?s circumstances warrant it, he said.

As an example, Mr. Cox said an insurer selling a type of policy that can be prone to higher losses, say retrocessional reinsurance, may have that book of business come under review by BMA insurance staff every year, instead of biennially.

Retrocessional policies are sold to reinsurers by other reinsurers, and generally carry a high pricetag in recognition of a higher risk of large losses.

Mr. Cox, who was recently honoured by the Bermuda Insurance Institute as the (Re)Insurance Person of the Year, sits on the technical committee of the International Association of Insurance Supervisors, and has helped drive the adaption of 28 core principals to regulation of reinsurers, or those who insure other insurers.