BERMUDA Law and Practice Contributed by: Brad Adderley, Matthew Carr, Max Tetlow, Cathryn Minors, Josephine Noddings, Aleisha Hollis, Melinda Mayne, Milaun Perott and Mya Gibbons, Appleby
ally, where a contract contains an arbitration clause as the means of handling disputes, this will be upheld. 9.6 Enforcement of Awards Concerning the enforcement of awards, see 9.4 The Enforcement of Judgments . 9.7 Alternative Dispute Resolution Dispute resolution is still predominantly litigation- focused in Bermuda; however, there has been an increase in the use of arbitration clauses in Bermu- da law-governed agreements and increased activity within the Bermuda Branch of the Chartered Insti- tute of Arbitrators. Many companies recognise and appreciate the merits of arbitration as a cost-effective and potentially quicker method of resolving disputes. Further to this, many companies value keeping their disputes confidential, which can be achieved through arbitration but not through the courts. 9.8 Penalties for Late Payment of Claims Specific penalties in regard to late payment of claims would be subject to the provisions of the insurance contract between the insurer and the insured. How- ever, under the Insurance Act, the BMA has powers of intervention and direction in circumstances where it is believed that the insurer is at significant risk of being unable, or is unable, to meet its obligations to policyholders. These interventions may include the BMA instructing a (re)insurer to cease writing further (re)insurance contracts, to limit the aggregate amount of premiums written during a specified period, not to make new investments, or not to declare or pay divi- dends. 9.9 Insurers’ Rights of Subrogation Bermuda law recognises an insurer’s rights to sub- rogation against third parties who have caused loss to the insured. These rights can be enacted provided the insurer has discharged its liability under the policy.
industry for decades, it is a natural progression for the jurisdiction. The BMA has taken a proactive response to the grow- ing insurtech market, anticipating the needs of current and future players. Leveraging Bermuda’s reputation as a centre of excel- lence for innovation in a sound regulatory environ- ment, the BMA has launched two parallel innovation tracks initially targeted at the insurtech market: • the insurance regulatory sandbox (the “Sandbox”); and • an innovation hub (the “Innovation Hub”). The BMA has endeavoured to provide innovative solu- tions in the insurance industry to maintain Bermuda’s dominance in the global ILS and captive sectors. The Insurance Regulatory Sandbox The Sandbox is a space where companies can test new technologies and offer innovative products and services to a limited number of customers in a con- trolled environment, and for a limited period of time. The Sandbox is available for entities registered, or proposing to become registered, as an insurer or insurance intermediary under the Insurance Act. The BMA encourages the use of a separately incorporat- ed company (subsidiary or joint venture) to carry out activities within the Sandbox. The licences available are an ILT for a long-term insur- er, an IGB for a general business insurer, an IM for an insurance manager, an IA for an agent and an IB for a broker. On successful graduation from the Sand- box, the company will be relicensed under an exist- ing class of insurer or insurance intermediary (see 2.1 Insurance and Reinsurance Regulatory Bodies and Legislative Guidance ). Innovation Hub The Innovation Hub is a platform for exchanging ideas and information, and for facilitating dialogue between the BMA and market participants. The space is designed for activities not directly regulated by the BMA and is ideal for a company still developing its
10. Insurtech 10.1 Insurtech Developments
Insurtech is the insurance industry’s next evolution and, given that Bermuda has been at the forefront of providing innovative solutions in the insurance
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