Bermuda’s Regulatory Leadership in Captive Insurance and Digital Assets
A Strategic Overview
Bermudais the world’s leading offshore captive domicile and a top destination for captive insurance and digital assets, thanks to its progressive regulations and global market influence.This article explores the latest trends in both sectors and what they mean for businesses already active in—or looking to enter—these markets.
Captive Insurance
Bermuda’s captive insurance sector leads the world in both scale and innovation, setting the benchmark for advanced risk solutions. The Bermuda Monetary Authority’s Captive Report 2022 reveals that 65% of the market operates as pure captives, and the jurisdiction writes over $24 billion in gross premiums each year, with 72% of risk originating from North America. The BMA emphasizes the sector’s dynamic progress in climate risk protection, parametric insurance for agriculture and energy, and the expansion of ESG-aligned strategies. These advancements reinforce Bermuda’s reputation as a hub for forward-thinking captive solutions that address both traditional and emerging risks.
Source of Graph, edited image 2025
Bermuda ranks among the world’s top three captive insurance domiciles, representing 10.2% of the global captive market, and continues to serve as a premier jurisdiction of choice for corporations seeking stability and operational adaptability.
Bermuda’s Solvency II equivalence further boosts its global appeal, simplifying international transactions while keeping regulations agile. Notably, at the 2024 Bermuda Captive Conference, Timae Flood, Deputy Director of Insurance Supervision, clarified that Bermuda’s captive insurance entities are not subject to the equivalent provisions of the Solvency II directive. As such, existing captive classifications remain unaffected by the jurisdiction’s Solvency II equivalence. Let’s look into additional recent key Regulatory Developments:
1. Segregated Account Governance:
In July 2024, the BMA updated guidelines for segregated accounts, emphasizing transparency and stronger protections for policyholders (BMA, 2024).
2. Recovery and Resolution Plans:
Effective May 30, 2024, amendments to the Insurance Act 1978 introduced Section 6G, granting the BMA the power to require designated insurers—including Classes 3A, 3B, 4, C, D, E, and insurance groups—to develop formal recovery plans in line with prescribed standards.
In April 2024, the BMA issued the Insurance (Prudential Standards) (Recovery Plan) Rules 2024, which take effect in May 2025 and set out comprehensive requirements for the preparation and maintenance of these plans. This regulatory development marks a significant advancement in strengthening the resilience of commercial insurers to withstand financial stress, safeguarding policyholder interests, fostering market stability, and enhancing the overall robustness of Bermuda’s insurance sector (BMA, 2024).
The BMA will consider the following factors in determining whether an insurer should prepare a recovery plan under Section 6G:
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Whether the insurer conducts domestic business
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If the insurer’s three-year rolling average of total assets equals or exceeds $10 billion
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If the insurer’s three-year rolling average of total gross written premiums equals or exceeds $5 billion
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Whether the insurer is subject to enhanced supervisory monitoring by the BMA or another relevant supervisory authority
3. IFRS 17 Compliance:
Effective 26 February 2025, updates to Bermuda’s Insurance Account Rules will align with IFRS 17, streamlining financial reporting and data consistency. This amendment highlights the BMA’s commitment to modernizing regulatory standards and supporting the insurance industry’s transition to IFRS 17 compliance.
Digital Assets
The Digital Asset Business Act (DABA), enacted in 2018, established Bermuda as a pioneer in digital asset regulation. The regime covers licence applications, custody and asset protection, anti-money laundering (AML) compliance, financial recording requirements and prudential standards, with ongoing updates that reflect the dynamic nature of the sector. Recent developments include:
Recent Updates:
Stablecoin Governance (May 2024):
Guidance outlines requirements for governance, reserve backing, and risk controls for stablecoin issuers—an area of growing interest for insurers seeking tokenized asset solutions.
Custody Rules (2024):
Digital Asset Business (Custody of Client Assets) Rules provide enhanced safeguards for client assets, reinforcing the security of blockchain-enabled financial products.
Stronger Enforcement Measures:
Non-compliance with DABA provisions can now result in penalties of up to USD 10 million or imprisonment, underscoring the BMA’s strong enforcement stance and commitment to maintaining market integrity.
Bermuda’s Strategic Advantages
Global Collaboration
Bermuda’s strong reputation for fair rules comes from following international guidelines. Renewed Solvency II equivalence, IAIS membership, and the 2024 Lloyd’s Memorandum of Understanding (MoU) ensure its standards harmonize with global best practices. These partnerships foster cross-border innovation while maintaining rigorous oversight.
Trusted Oversight: The island’s enforcement system protects fair and transparent markets without holding back development and innovation. This equilibrium attracts investors seeking stability in high-growth sectors like digital assets.
Financial Reporting Flexibility: Bermuda’s accounting framework offers a unique advantage: entities may adopt any globally recognized standard, including IFRS, U.S., UK, Canadian, or BMA-approved GAAP (Conveys, 2023)
Businesses in Bermuda can choose from major global accounting standards, simplifying compliance for multinationals. This flexibility allows multinational organizations to align financial reporting with parent company practices or investor expectations, reducing compliance complexity and costs.
Public-Private Synergy
At the 2025 Consensus conference, Premier David Burt highlighted Bermuda’s goal to lead in digital finance, stressing partnerships with industry players to refine laws like DABA (Government of Bermuda, 2025). Antares Bermuda actively contributes to this effort, participating to help shape pragmatic regulations.
“We aim to be at the forefront of innovation while maintaining regulatory integrity.” — Premier Burt.
Conclusion
Bermuda’s leadership in captive insurance and digital assets stems from its adaptive regulation, financial reporting flexibility, and public-private collaboration — securing its position as the top offshore domicile 2024 and Bermuda captive insurance market leader. For organizations operating in these sectors, aligning with BMA standards is critical to leveraging growth opportunities.
Antares Bermuda’s audit services provide the assurance needed to navigate this dynamic environment, combining technical rigor with deep regulatory insight.
Contact Antares Bermuda for specialized guidance on regulatory audits, compliance strategy, and risk management solutions.
You can always get to know more when you contact us at: info@antarescpa.bm