The Bermuda Monetary Authority will be given the money it needs to succeed in its role as a watchdog over the insurance industry thanks to new legislation, said yesterday.

The Bermuda Monetary Authority Amendment (No. 4) Act will increase the registration and annual fees paid by insurance companies on the Island to the BMA. However Shadow Finance Minister Grant Gibbons questioned the ?pretty dramatic? increases in the fees, some of which are more than 100 percent.

Bermuda, he said, must not price itself out of the insurance market.

?The BMA, as our independent regulator of all financial services, must have the appropriate resources to continue to implement an effective and practical supervisory regime that will maintain Bermuda?s position as the domicile of choice for insurance and reinsurance solutions,? Ms Cox said yesterday. ?Bermuda, together with other insurance domiciles, is being required to implement a regulatory regime that can stand up to international scrutiny. It is critically important that the Authority has the financial resources to take any regulatory action necessary to ensure that we are protecting policyholder rights and protecting the jurisdiction?s reputation.

?In an effort to enhance the Authority?s regulatory regime, the Insurance Regulatory Unit over 2004 has increased both its staffing levels and professional training in order to implement the proposed on-site regime of insurers and other regulatory initiatives, which will begin early 2005. There are currently 24 positions allocated to insurance.?

Twenty of those 24 positions are already filled, she said, and the final four will be filled soon.

?The fee increases range from a moderate five percent increase for class 1 and 2 licences, to more significant increases for the commercial insurers and reinsurers,? Ms Cox continued. ?The Authority?s level and frequency of supervisory scrutiny will depend on the nature and risk of each insurer.?

?We?re in competition here,? Dr. Gibbons observed. Though saying he understood the importance of a qualified regulator, Dr. Gibbons added: ?I am increasingly concerned about the cost of the jurisdiction, the cost being imposed by Government, and the cost of the regulator.

?At the end of the day, this is the only game in town. We have to be careful we don?t price ourselves out of the market.?

Though she did not have specifics at hand, Ms Cox noted that Bermuda is still very competitive in comparison to other jurisdictions ? save some states in the US and, regarding health insurance, the Cayman Islands. The fee increases, she said, will result in $1.5-$2 million additional income for the BMA ? all of which will be spent on staff costs.