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IMAC Update on the Fast-Approaching Cayman Captive Forum

Grand Cayman CCF 2019 SF
November 07, 2019 recently caught up with Insurance Managers Association of Cayman (IMAC) to discuss the world's largest captive insurance conference, the Cayman Captive Forum, happening December 3–5 at The Ritz-Carlton, Grand Cayman, Cayman Islands. readers can still register online until November 29.

Tell us more about the origins and the history of the Cayman Captive Forum and how its goals have evolved over the course of its existence.

The forum had humble beginnings in 1992 with 50 people attending and the goal of bringing together those who were instrumental in developing the captive industry to share their expertise. Last year, in our 26th successive forum, we had over 1,500 attendees, and the same goal continues and has expanded to offer unparalleled education and the opportunity to hold a great number of board meetings, so much so that we have had to drop the Friday golf tournament, as attendees just need to relax! The forum continues to be a marketplace for captive directors, risk managers, service providers, and Cayman's regulators to meet and develop the industry.

It is well known that the Cayman Islands is a leading international jurisdiction for captive insurance, with 673 companies reported at the end of 2018. Where does this number stand currently, and what are some Cayman captive industry facts, figures, and statistics that are the most impressive?

There were a total of 655 Class "B," "C," and "D" insurance companies and 25 insurance managers under the supervision of the division as of September 30, 2019. Pure captives and group captives represented the two main categories, with 289 and 121 companies, respectively. Twenty percent of the total Class "B," "C," and "D" insurance companies were formed as segregated portfolio companies (SPCs), with over 600 segregated portfolios.

A count of the companies alone does not represent the growth of the industry, as there continues to be consolidation due to mergers, so it is more meaningful to recognize that 10 new licenses were issued in the third quarter alone while total premiums increased by $258 million in the same period and total assets also increased by $3.98 billion.

What makes the Cayman Islands Monetary Authority (CIMA) stand out, and what has contributed to Cayman's success as a captive domicile?

CIMA has a long history of helping to foster innovation and really does try to understand what motivates captive owners to choose Cayman as their domicile. Regular prudential meetings are something that CIMA encourages. This gives captive owners the opportunity to discuss a wide range of issues as well as focus on their specific captive goals and challenges, while such meetings also allow CIMA to discuss regulatory updates and expectations. Overall, CIMA's goal is to ensure that an appropriate level of oversight is maintained, depending on the risks presented, and it does a very good job with this.

The Cayman Islands international insurance industry is comprised mainly of companies insuring risks in North America (90 percent). Is this landscape expected to change moving forward? Why or why not?

North America will always be the primary Cayman market, but, over the last few years, Cayman has seen captive formations from other regions such as South America and Asia. This is expected to continue as Cayman's reputation as a leading captive domicile continues to grow.

The Cayman Captive Forum provides a wide array of sessions and events. How can forum sponsors, as well as those new to the captive industry, get the most out of the conference?

The complimentary Tuesday morning tutorial sessions are geared towards those who are new to the industry and feature various captive 101 sessions covering captive formation, actuarial reports, board duties and responsibilities, risks to be written, and tax and regulatory updates.

Sponsors have the opportunity to be featured on the forum app and have their names displayed in between sessions, while, depending on the item sponsored, there can be opportunities to distribute marketing material. The exhibit halls are also a popular meeting place and an ideal spot to learn more about the captive industry from the various sponsors.

Tell us about forum sessions that will be especially useful to those with many years in the captive industry?

All sessions have been nominated by attendees, which is partly why IMAC takes the time itself to organize the forum and is able to ensure sessions remain topical and relevant. Panels will cover subjects such as the return of the hard market, technology and the role it has to play in health care, and captive success stories and additional captive uses. The afternoon sessions, which are generally more advanced, are arranged in three tracks, with two being predominantly health care and the third being more general and addressing current issues for group captives, SPCs, and, of course, more tax.

What is one of the key themes at your forum this year?

The forum doesn't have a theme as such; however, the opioid crisis features in several sessions as well as cyber risks and emerging technologies. In addition, there are sessions that cover regulatory and tax updates that apply to captives.

What economic and regulatory issues will be highlighted at this year's forum?

The impact of economic substance will be highlighted along with the role of captive boards as well as other Cayman regulatory developments such as beneficial ownership and directors registers and data protection.

Looking ahead, what changes is IMAC considering for the forum?

Last year, IMAC started the forum earlier and kicked off the captive tutorial session early on Tuesday rather than starting after lunch. This permitted each day to finish a little earlier to allow more time for networking and captive board meetings. IMAC is always open to suggestions, but we do expect the forum app to be used much more. IMAC is in the fortunate position to host the world's largest captive conference, so, in some ways, there is little that needs fixing for what has been a very successful format for over 25 years.

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