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Cayman Islands Issues 33 New Captive Licenses in 2018

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January 29, 2019

During 2018, the Cayman Islands issued 33 new captive insurance company licenses (Class B, C, and D), according to numbers released by the Cayman Islands Monetary Authority (CIMA). During the same period, 26 licenses were cancelled, for a net gain of 7 captive licenses. This brings the cumulative total to 703, up from 696 at the end of 2017.

Over the past 5 years, CIMA issued new captive insurance company licenses as follows.

Year

Licenses Cancelled

Licenses Issued

Total Licenses

2014

24

23

760

2015

74

22

708

2016

36

39

711

2017

48

33

696

2018

26

33

703

Running total class B, C, and D licensees broken out by category and license class are shown in the two tables below, as reported by CIMA.

Category (B, C, and D licenses)

Total License Count as of 12/31/18

Commercial insurer

32

Group captive

120

Pure captive

312

Reinsurance company

65

Segregated portfolio company (SPC)

149

Special purpose vehicle

25

Total

703

 

License Class

Total License Count as of 12/31/18

Class B insurer

674

Class C insurer

25

Class D insurer

4

Total

703

CIMA reported that the Cayman Islands remains a leading jurisdiction for healthcare captives, which made up nearly one-third of its captive insurance companies at the end of 2018. Accordingly, medical malpractice liability remained the largest primary line of business, with almost 32 percent of companies re/insuring medical malpractice.  According to CIMA, the second largest line of business was workers compensation, with 22 percent of companies assuming this risk.

As of December 31, 2018, CIMA said, North American risks comprise 90 percent of the Cayman Islands international (nondomestic) insurance industry, representing 632 of the total captive licenses and $13.2 billion of the total $15.4 billion of international insurance premiums.

The different classes of licenses, according to the Insurance Managers Association of Cayman (IMAC), are as follows.

  • Class B. The Class B license class is comprised of captive insurance companies, including pure captives, segregated portfolio captives, group captives, association captives, special purpose vehicles, open market insurers, and rent-a-captives.
  • Class C. The Class C license group includes entities that provide reinsurance through the issuance of insurance-linked securities such as catastrophe bonds, sidecars, collateralized reinsurance, or similar instruments.
  • Class D. The Class D license category consists of commercial reinsurers that carry on reinsurance business and such other business as approved by CIMA.

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