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Bermuda Captive Conference Chair David Gibbons Fills in the Blanks

Photo of David Gibbons, Bermuda Captive Conference chair, and event logo
August 17, 2017

This week, spoke with Bermuda Captive Conference Chair David Gibbons to discuss the 13th annual conference, happening September 10–13 at the Fairmont Southampton Resort, Southampton, Bermuda. Mr. Gibbons invites readers to register online now so as not to miss out on this paramount event. Find out more in the following interview with Mr. Gibbons.

Please tell readers about the history of the Bermuda Captive Conference and how the conference has evolved since it first began.

The world's largest captive domicile and third-largest re/insurance market, Bermuda, will hold its 13th annual Bermuda Captive Conference from September 10–13. The conference remains a consistent focal point of Bermuda's captive industry. This event brings together Bermuda's full industry talent to share their experience with captive owners and prospective captive owners to discuss important ideas and innovations of things to come.

The conference has evolved to attract more overseas participants than ever before. Overseas bookings, measured in terms of the number of room nights, total over 900 so far. There are also many more captive owners than ever before. What this means is that attendees will have access to people driving the business decisions. In moving the conference from June to September, due to America's Cup, we were concerned about working with people's schedules. However, the 2017 September revision date has not deterred robust registration.

What are some of the current Bermuda captive industry facts, figures, and statistics that are the most impressive?

Bermuda has just under 800 registered captives, which has remained relatively stable over the last few years. There has also been growth from a variety of places, including an impressive renewed interest from the traditional US market. We predict a significant increase coming from the US in line with a sharp market uptick. Similarly, the fastest-growing captive market, Latin America, also continues to grow in Bermuda. In recent years, renewed growth has come from Canada due to the signing of the Canada-Bermuda Tax Information Exchange Agreement. Also noteworthy is the Bermuda Insurance Management Association (BIMA) Captive Market Survey, which revealed that the captive industry holds 550-plus jobs on an island of just 67,000 inhabitants. This is a telling figure.

Who can attendees expect to come into contact with while at the conference?/strong>

Everyone involved with captive activities will be at the conference. This includes, but is not limited to, captive owners, risk professionals, reinsurance companies, brokers, and tax accounting, actuarial, investment, and legal professionals. All of the full talent from Bermuda will be on display.

How does the Bermuda Captive Conference stand out from other industry conferences?

Three major areas make Bermuda stand out in the industry. First, Bermuda recognizes contributions of its captive clients to the captive market on a local and global basis through the Captive Hall of Fame. Second, Bermuda's sessions are not about the regurgitation of facts, but rather, our sessions center around interpreting what the facts mean while providing innovative ideas surrounding captive use. Third, the conference provides a variety of networking opportunities, including golf and other exercise activities, sessions, networking breaks, food, refreshments, and receptions.

What's new this year with the conference?

The conference has a number of new aspects this year. First, we have expanded the actual number of sessions. This means that where sessions previously went for 2½ days, with ½ day dedicated to golfing/walking/tennis, this year, the social exercise activities will be moved to Sunday, leaving 3 full days of sessions. The additional sessions will focus on the global and political space and government change and the impacts of these changes on investments, reinsurance, and how we as a market are dealing with change. Second, new insurance risk lines (to a larger extent than previously) will be discussed, including global employee benefits programs and cyber risk. Third, sessions will also focus on impacts in global tax development. A very solid and senior panel will discuss the Foreign Account Tax Compliance Act (FATCA), base erosion and profit shifting (BEPS), and other tax changes that are impacting the market. There will also be four sessions on investment. These sessions will cover how captive insurers can balance the interplay between risk aversion and investment returns in the context of a low-interest-rate environment, and how to do this without accepting undue risk in their captive insurance company.

In addition to speaker sessions, panel discussions, and technical training sessions, another conference highlight is "Bermuda Shorts." Tell us about Bermuda Shorts.

Bermuda Shorts was first introduced last year and consists of three to four short 15-minute segments—similar to TED talks. Each "short" is 10–12 minutes with 3–5 audience questions. These talk segments have good attendance and are direct and to the point. One session will be dedicated to a full briefing on the BIMA Captive Market Survey. Another will be a presentation by A.M. Best of their perspectives on the market.

What advice do you have for captive owner, risk manager, and insurance professional conference attendees who are new to the captive insurance industry?

New attendees should plan their schedule ahead of time. While doing this, attention and focus should be given to networking events in order to maximize their ability to meet industry people and to find out what these people are doing. The Bermuda Business Development Agency (BDA) will be hosting a speed-networking event in the Gardenia Room on Tuesday and Wednesday, allowing attendees to meet top industry professionals in a short time space to build relationships quickly. Established professionals, along with new and interested entrants to the captive industry, will be interested in Monday's workshop on forming a Bermuda captive. This session will highlight the Butler University student-run captive insurance company from the perspective of Butler professor Zach Finn and the captive's student leader, Derek DeKoning.

What spells "success" in terms of expected outcomes for this year's Bermuda Captive Conference?

Success means that people who are looking at the Bermuda market will see what it is like, experience the intellectual capital that exists in the domicile, and emerge with an increased understanding of their ability to set up a captive. The conference assists people and organizations looking to set up a captive by offering them free registration passes. We aim to help these individuals and organizations by giving them the knowledge, tools, and support to facilitate their move forward in forming a Bermuda captive insurance company. Likewise, success means that existing captive owners learn from others to change their business model and make it better—ultimately improving their captive.

Describe the captive regulatory environment in Bermuda and what makes it unique.

The strength and breadth of experience of Bermuda regulators is unmatched. Bermuda's enhanced commercial insurance regime reached full Solvency II equivalence. This formal recognition means that Bermuda's commercial re/insurers and insurance groups will not be disadvantaged when competing for, and writing, business in the European Union. Solvency II equivalence also means that EU member states recognize Bermuda as the group supervisor for its insurance groups that operate in the EU. This allows normal captive patterns and licensure to be exempt from Solvency II, or, if in Europe, captives can elect to be subject to Solvency II. Obtaining this equivalence shows the strength and robustness of Bermuda as a regulator. Bermuda captives can be confident that they are being regulated properly, and the increased Canadian interest in Bermuda evidences the fact that the domicile is well-regulated and engaged.

Bermuda was the world's first captive domicile and is the largest captive domicile. Considering the increased competition from other jurisdictions, what keeps Bermuda thriving today, and what will keep it thriving into the future?

Bermuda has thrived and will continue to thrive due to its connection to the reinsurance market and its ability to be a one-stop shop for captive owners to not only write their captive business, but also structure and renew their entire reinsurance program. The overall intellectual capital in Bermuda—apart from London and New York—sets it apart. Nowhere else in the world can all a captive's comprehensive needs be met within the space of two blocks. Bermuda has also succeeded in retaining people (captives and professionals) and encouraging more to come. Bermuda has stood the test of time (and Solvency II) with a reputation for having a strong regulatory framework, and stands as a respected and developed international domicile.

For further reading on the 2017 Bermuda Captive Conference, see "Check the Bermuda Captive Conference Schedule and Watch BDA Webcasts" and "Anthropologist To Speak at Bermuda Captive Conference."

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