THE INSURANCE

INDUSTRY IN THE
CAYMAN ISLANDS
Katheryne Gonzalez Ramirez
Khadeen Jackson

Insurance is the pooling of fortuitous losses through the issuance of a

contract with an insurer, which abides to indemnify of such loss the
insured individual or business. The Cayman Islands is a jurisdiction
that is built between the British and American insurance practice.
The insurance laws and regulations for insurance companies varies
per class of insurers. Furthermore, Based on our research well
provide an overview of the local insurance laws, regulators, local
insurance entities and insurance products offered within the Cayman
Islands.

INSURANCE LAW 2010

One of the primary law within the Cayman Islands is the Insurance Law 2010. The law states the
minimum requirements and licensing an organization must meet to carry out contracts of
insurance. Under the law there are four categories of insurance license that are granted by CIMA in
accordance with the insurance business.
The categories consist of:
Class A
Class B
Class C
Class D
The two main insurer are Class A (domestic insurers) and Class B (captives). Class A Insurers
License permits a local or an external insurer to carry on domestic insurance business. Then, Class
B Insurer permits business to carry on captive insurance business whether restricted or
unrestricted.
The law is a clear and concise provisions have been crafted dealing with the continuing obligations
for licensees, including requirements to maintain audited accounts, undertake certain filings,
conform to solvency requirements and employ fit and proper personnel in key roles. The Insurance
Law 2010 is meant to set the process and standards for organizations to follow in order to become
a licensed insurance.

HEALTH INSURANCE LAW AND

REGULATION
The law created a framework for the healthcare system on the Cayman Islands.
Consequently, it stipulates that all employees and resident of the Cayman Islands
is required to have an active health insurance plan in place. Moreover, the Health
Insurance Law and Regulation sets the minimum standards that business must
follow to provide health insurance coverage to their employees (Department of
Health Regulatory Services, 2016). For example, the employers are mandated to
provide a Standard Health Insurance Contract plan for their employees. Likewise,
employers are responsible for providing health insurance to all staff and
dependents of the employees.
The law stipulates that 50% of the premium is paid by the employer and the
remaining 50% by the employee (Department of Health Regulatory Services,
2016). On the other hand, the employees dependent is deducted from employees
salary. Overall, the residents of the Cayman Islands are mandated by law to have a
health insurance plan in force by the approved insurance companies.

PENSION (AMENDMENT) LAW

The Pension (Amendment) Law came into effect on January 1st, 1992 and had been
refurbished throughout the years. Furthermore, the Cayman Islands Pension Law
requires and the equivalent of 10% or more of contribution between employers and
employees out of the monthly salary of an employee. Likewise, the Cayman Islands
pension system is divided into private and public sectors which are governed by
separate legislations.
For example, the private pension is regulated by the Cayman Islands Monetary
Authority; whereas the public pension fund is administered by the Public Service
Pension Board. Additionally, from 2000 onwards, the Public Service Pensions Board
established a total contribution of 12% pensionable earnings. Moreover, in
accordance with the latest review of the Cayman Islands National Pensions
(Amendment) Bill, 2016 the retirement age was increased from 60 to 65 years and
reduced to a six-month period from which an employer is required to commence
pension contribution.

CAYMAN ISLANDS MONETARY

AUTHORITY (CIMA)
The Cayman Islands Monetary Authority (CIMA) is a national
association in charge of supervising and implementing regulations
to the insurance entities within the Cayman Islands. Likewise, the
Insurance Supervision Division primary purpose is to promote and
maintain a resilient financial system by performing on-site and offsite monitoring approaches. The primary off-site monitoring
includes reviewing annual audited financial statements and
ensuring that the licensee maintains capital requirements. Then,
the on-site monitoring is performing inspections where they review
the policies and procedures related to internal controls, business
operations, and anti-money laundering. Overall, CIMA enforces the

CAYMAN ISLANDS INSURANCE ASSOCIATION

(CIIA)
The Cayman Islands Insurance Association (CIIA) was created in 2004

with the purpose of bringing together the various associations

representing the insurance industry. (Cayman Islands Insurance
Association, 2004) The association is a single body that is composed of
agents, brokers, and companies, who works along the side of CIMA to
develop Codes of Conduct to protect the public interest. Likewise, CIIA
creates and maintain high standards of services, ethics, transparency
and good practice to promote the national and international reputation
of the insurance market in the Cayman Islands. (Cayman Islands
Insurance Association, 2004) CIIA code of conduct for Cayman Islands
Insurance Brokers, are standards that assure public confidence and
promote integrity in the trading practice of insurance companies.
(Cayman Islands Insurance Association, 2004)

Insurance Managers Association

The Insurance Managers Association of Cayman (IMAC) is a nonprofit organization run by and for the Caymans captive insurance
industry, along with insurance managers. (Insurance Managers
Association of Cayman, n.d.) A captive insurer is an insurance
company created by non-insurance organizations to insured their
risk; in other words, to provide self-insurance. (Rejda &
McNamara, 2014) The main purpose of the association is to
promote the cooperation of captive insurance industry with local
government, regulators and other entities to develop prosperity of
the industry. The organization purpose is to promote quality,
integrity, and intellect of the industry to sustain innovation and
constant growth within the insurance industry.

DEPARTMENT OF HEALTH REGULATORY SERVICES

The Department of Health Regulatory Services monitors and
regulates the health insurance in the Cayman Islands
(Department of Health Regulatory Services, 2016).
Furthermore, the Health Insurance Commission was created
on July 1st, 2008 with the purpose of assisting the public with
resolutions on complaints related to the health insurance
provision (Department of Health Regulatory Services, 2016).
Likewise, the premiums rates are assessed and monitored by
the Commission and advise the Minister on any amendments
to the Health Insurance Law and Regulation.

CLASS A INSURER
Within the Cayman Islands, there are 9 insurance companies registered with CIMA as Class A Local Insurance Company
who offered insurance coverages such as motor, property, health, marine, aviation, life, annuities, workersmens
compensation, liability, and casualty.
Organizations:

BAF INSURANCE COMPANY (CAYMAN) LIMITED

BRITISH CAYMANIAN INSURANCE COMPANY LTD.
CAYMAN FIRST INSURANCE COMPANY LIMITED
CAYMAN ISLANDS NATIONAL INSURANCE COMPANY LTD.
ISLAND HERITAGE INSURANCE COMPANY, LTD.
PAN-AMERICAN LIFE INSURANCE COMPANY OF THE CAYMAN ISLANDS
SAGICOR LIFE OF THE CAYMAN ISLANDS LTD.
SAXON MOTOR & GENERAL INSURANCE COMPANY LTD.
THE INSURANCE COMPANY OF THE WEST INDIES (CAYMAN) LIMITED.

CLASS B INSURER
The Cayman Islands are recognized as an international financial center and have become one of the worlds

largest captive domiciles. A captive insurance company is established by a parent firm to insured its loss
exposures, reduce premiums cost, retain, manage and control losses, and foremost insure the uninsurable
(Rejda & McNamara, 2014).
Likewise, the legal framework is based on English Common Law, with the final court of appeal being the

Privy Council in London (Watt, O'Mahony, Gower, & Watler, 2015). Moreover, 151 entities specialize in
Workers Compensation, 152 first class business in Professional and General Liability, and 246 on Hospital
and Medical Malpractice Liability (Watt, O'Mahony, Gower, & Watler, 2015). Likewise, a 90% of the insured
risk the captive insurance companies assume are from the organization in North America (Watt, O'Mahony,
Gower, & Watler, 2015).
Organizations:
Marsh Management Services Cayman Ltd.
Advantage International Management Cayman Ltd.
CSI International Underwriting (Cayman) Ltd.
Aon Insurance Managers (Cayman) Ltd.
Kensington Management Group Ltd.

CONCLUSION
The insurance industry in the Cayman Islands offers a broad range of insurance
products through the different license classification of insurance business in
accordance with the Insurance Supervision Division of Cayman Islands Monetary
Authority. The purpose of this paper is to provide an overview of the insurance
market in the Cayman Islands. Therefore, this paper consists of three major
reforms that mandate the regulations for the various insurance entities.
Furthermore, through the Insurance Law 2010, the Cayman Islands Monetary
Authority was assigned as the insurance-related entities regulator. The type of
insurance license permits a local or an external insurer to carry on domestic
insurance business or limited insurance business reinsurance in the market as
approved by the Authority. Additionally, different trade associations ensure
compliance with the laws and regulations for insurance-related entities to protect
the public interest. Overall, covering the insurance sector in the Cayman Islands
that is mandated by law and tailored to the demand and needs of individuals and
businesses.

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