The Bermuda Monetary Authority has rolled out an enhanced risk assessment model to help it determine even more effectively when an insurance company needs more oversight.

The Insurance Supervisory Model and Risk-Based Framework is one of a series of steps that the BMA is taking to develop and enhance its supervisory approach in the insurance sector.

The new model provides a consistent methodology for the assessment of supervisory risks in individual insurers and also provides an internal rating tool that the BMA can use as it assesses and monitors risk.

Deputy Supervisor of Insurance at the Bermuda Monetary Authority Shelby Wheldon said that the framework is more comprehensive than which was used in the past.

?It is a development of our risk based approach to ensure that we are employing our resources in those areas that are most needed,? Mr. Wheldon said. ?This is in line with our ongoing development of our regulatory regime to ensure that we are in accordance with international best practice and risk-based approach.?

The BMA has now commenced assigning insurers to risk impact groups and scheduling on site reviews with a number of insurers.

The substantive onsite inspection programme was designed to assist the BMA in obtaining a better understanding of insurers? business and a fuller assessment of the effectiveness of the systems and controls used by management to monitor and limit the risks to which their business is exposed.

Through an assessment of the risk profile of an insurer, the framework assists the BMA in determining the level and nature of regulatory supervision that may be required.

The goal is to detect potential problems at an early stage so that regulatory action can be taken on a timely basis and insurers can either be restored to compliance or have their exit from the market managed efficiently.