BERMUDA Law and Practice Contributed by: Oliver MacKay, Michael Frith, Kyle Masters and Jennifer Haworth, Carey Olsen
3. Arbitration in Insurance Disputes 3.1 Recognition of Arbitration Clauses Arbitration clauses are common in commercial insur- ance and reinsurance contracts concluded in Ber- muda or by Bermuda-based insurers and reinsurers. The Bermuda courts generally enforce arbitration agreements and have confirmed that this should be the ordinary approach. Their pro-enforcement powers include granting anti-suit injunctions to restrain parties from acting in violation of an arbitration agreement. 3.2 Enforcement of Arbitral Awards Bermuda is subject to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbi- tral Awards (the “New York Convention”), extended to Bermuda in 1979. Part IV of the Bermuda Interna- tional Conciliation and Arbitration Act 1993 provides the statutory enforcement regime for New York Con- vention awards. An award creditor applies for leave to enforce by origi- nating summons, ordinarily on an ex parte basis, sup- ported by affidavit evidence exhibiting the arbitration agreement and original award. Once leave is granted and the order served, the award debtor may apply to set it aside; otherwise, the award may be enforced as a judgment. The limited New York Convention grounds for resisting enforcement include matters such as public policy and the dispute’s incapability of settlement by arbitration. 3.3 Practical Use of Arbitration in Insurance Matters Arbitration is the prevalent form of insurance dispute resolution in Bermuda and is particularly common in property and casualty, captive, excess-liability and reinsurance business. Domestic arbitrations are gov- erned by the Arbitration Act 1986, while international arbitrations seated in Bermuda are governed by the Bermuda International Conciliation and Arbitration Act 1993, which incorporates the UNCITRAL Model Law. Where Bermuda law governs the arbitration agree- ment, a Bermuda arbitration will generally be confi- dential. The Arbitration Act 1986 provides a right of appeal on a question of law, subject to consent or leave. There is no equivalent merits appeal under the
is outside Bermuda, the plaintiff may require leave to serve out of the jurisdiction under Order 11 of the Rules of the Supreme Court 1985. The External Companies (Jurisdiction in Actions) Act 1885 permits a foreign company carrying out insur- ance business in Bermuda through an agent or branch to be sued in the name under which it carries out busi- ness, with service on its Bermuda agent or manager. 2.3 Cross-Border Disputes and Conflicts Issues Cross-border disputes are addressed through Bermu- da’s rules on jurisdiction, service out, choice of law, and recognition or enforcement. An express govern- ing-law choice will ordinarily be respected, whereas jurisdiction may depend upon valid service, contrac- tual submission, or steps taken in the proceedings. Foreign money judgments may be enforced under the Judgments (Reciprocal Enforcement) Act 1958 or at common law, depending on the originating jurisdiction and the satisfaction of the applicable conditions. 2.4 Anti-Suit Injunctions The Bermuda courts generally enforce arbitration agreements and may grant anti-suit injunctions to restrain proceedings brought in breach of them. The usual approach is to grant relief where the arbitration agreement is valid and binding unless the respondent demonstrates strong reasons not to do so. Relief may be granted irrespective of where the foreign proceed- ings were commenced or whether Bermuda is the arbitral seat. Breach of an anti-suit order may amount to contempt and a resulting foreign judgment may be unenforceable in Bermuda. 2.5 AI-Related Dispute Resolution and Jurisdiction There are no specific trends or developments in how courts approach jurisdiction and choice of law in dis- putes involving AI systems yet. It is expected that the established contractual and conflict-of-laws principles are likely to remain the starting point, but AI disputes may make it more difficult to identify the place of the relevant conduct, the applicable law and the appro- priate forum where development, deployment, data inputs, decisions and resulting loss occur in different jurisdictions.
36 I NSURANCE L I T IGATI O N 2026
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