The current issues and an update on regulations affecting captive insurance were some of the topics up for debate at Bermuda Captive 07 yesterday.

A panel made up of Tim Faries, group head of Trusts and insurance group leader and partner of Appleby, Shanna Lespere, deputy director of insurance licensing and authorisations at Bermuda Monetary Authority (BMA), and Jason Carne, partner at KPMG Bermuda, were all on hand to discuss the latest legislative, regulatory and accounting developments and their impact on captives and to address any concerns raised by delegates at the conference held at the Southampton Fairmont resort.

Mr. Faries talked about the Insurance Act 2006 - the latest in a raft of regulatory measures launched in response to the International Monetary Fund (IMF) and the International Association of Insurance Supervisors and as a result of a consultation within the industry and produced by the Association of Bermuda Insurers and Reinsurers, Bermuda Insurance Management Association, BRBA and the Insurance Advisory Committee.

"We have worked very hard in Bermuda to ensure our regulatory framework remains current," he said.

"With the history of being in the business of managing captives that stretches over 40 years, I think we can say we know one thing well, and that is that we have the capacity for ensuring standards and the regulation appropriate for the level of risk that captives represent.

"I think that captives and captive owners can take away that Bermuda does captives and we know the appropriate level of regulation that is needed.

"These provisions had the benefits of being tested and tried in a very practical way and they work."

He explained how the Insurance Act 2006 works in a captive market context by establishing the minimum criteria for a "registered person", formalising the BMA's supervisory functions, enhancing the investigative and interventionary powers of the BMA, the requirement for notification of the approval process for changes to a "controller" (managing director, CEO or board of shareholders) and establishing an appeal tribunal process for initial formal reviews of certain BMA decisions.

Mr. Faries went on to outline the Companies Amendment Act 2006 undertaken by the Legislative Change Committee of Bermuda International Business Association with the Ministry of Finance and its modernisation, including unrestricted objects and powers, shareholder written resolutions, electronic delivery of documents, execution of instruments and secondary names to list but a few of the key amendments.

Ms. Lespere gave delegates an insight into the latest regulatory procedures in place that captives in Bermuda have to adhere to.

She talked about the captive manager on-site programme and its various components such as ensuring the filing of required documentation and meetings with senior management, as well as keeping up with international standards or risk assessment and management, claiming that it has already been well received by the industry and in the recent IMF review of Bermuda.

Best practice for captives included an increased use of independent directors by larger companies, adequate and regular reviews of financial information prepared by insurance managers and the frequent meeting of boards with auditors and/or forming audited committees, according to Ms. Lespere.

Finally, Mr. Carne touched on the main differences between US GAAP policies and Bermuda Statutory Accounting to bring delegates up to date with the primary changes in the way captives accounts are run.

Earlier in the day a special session for BCOA members and prospective members on The Role of Captives in a Softening Marketplace was discussed by moderator J Heyliger, managing director of Willis Management (Bermuda ), panelists Daniel Meyer, senior vice-president of Guy Carpenter & Company, Marsh USA's managing director, Arthur Koritzinsky, and Dale Creech, chief legal officer at Premier Health Partners.

Today offers a range of useful seminars focused on the Latest on US Captive Taxation, Measuring Captive Value and Performance and Audit Hot Topics, before lunch with the keynote speaker, US Consul General Gregory Slayton.

The day will conclude with a series of case studies about US Liability Programs, Using an Alternative Risk Solution for International Benefits and More than benefits to the Story (focused on what Nisource, who acquired Columbia Energy, have done with their Bermuda captive).