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Cayman says reinsurance market is booming

The first [Re]Connect reinsurance conference was held at the Ritz-Carlton Grand Cayman (File photograph)

Executives promoting the Cayman Islands as “one of the fastest growing reinsurance domiciles in the world” are citing the “second to none” quality of life there as one of the reasons.

In an AM Best TV interview, they talked about their hope for the US qualified jurisdiction status and how Cayman regulators will be able to help companies, even with the technological changes in the insurance industry that are being brought about by artificial intelligence.

The Cayman market last week launched what is planned as an annual reinsurance conference at the Ritz-Carlton Grand Cayman, an event they believe will ensure the emergence of the island as a major reinsurance market.

The [Re]Connect reinsurance conference was expected to attract some 400 delegates, including about 160 visitors, according to the Cayman International Reinsurance Companies Association, an organisation formed three years ago to drive reinsurance growth.

A Cayman Finance article said reinsurance in the islands is booming.

The Cayman Islands has eight Class D reinsurers with a physical presence and at least 80 Class B (iii)-licensed captive reinsurers. Last year, Cayman’s regulator issued 41 international insurance licences, the largest number in a decade, driven partly by the growing reinsurance sector.

The Circa event over Thursday and Friday included Life & Annuity and Property & Casualty reinsurers already on the island. The conference is designed to grow that business and also concentrate on the insurtech business.

Cayman is pursuing, mainly US business, and keeping an eye on US concerns over adequate asset testing for ceded reserves.

Circa said the Cayman Islands’ Financial Services industry is valued at approximately $5 trillion, with 680 international insurance licenses. The association said that the jurisdiction attracted 50 reinsurers and $25 billion in reinsurer asset growth in the past three years.

David Self, Circa chair, and Steve Papciak, Marketing Committee chair, recently told Lori Chordas, the AM Best TV interviewer, that Cayman has created a buzz in reinsurance circles and the conference was a good way to show what they had to offer.

Cayman already hosts the largest captive domicile conference in the world and is home to one of the largest funds industries.

Mr Papciak said: “Reinsurance is still growing and (Cayman is) one of the fastest growing reinsurance domiciles in the world and people are wondering why.”

Mr Self said the strategic focus on US business: “enables us to laser focus on the requirements of the US-based companies that are looking to come here and means we don't have to worry about other jurisdictions”.

But he also said: “The quality of life in Cayman is second to none. We have a simple work permit process to get on the island.

“There's a path to citizenship in Cayman. There's real estate that's available. You can buy a home. It's a lovely spot to live, good schools for the kids.”

Mr Papciak said: “The regulator here, the Cayman Islands Monetary Authority, is prudent and risk-based.

“And what you see in the insurtech industry is there's new emerging risks that some of the previous rules-based regimes might not be fully equipped for, or fully tailored to.

“So, when you have a risk-based regime that can respond nimbly and quickly, and most importantly, robustly to these new emerging risks, which I think really characterises the insurtech industry, it really just becomes a perfect fit.”

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Published April 22, 2024 at 7:45 am (Updated April 22, 2024 at 7:24 am)

Cayman says reinsurance market is booming

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