The Cayman Islands Monetary Authority is streamlining applications for Catastrophe Bond Vehicles, known as “Cat bonds,” of Class C insurers.
According to a press release from CIMA, effective Feb. 6, non-complex Cat bond applications can be approved at a divisional level by the Authority’s Insurance Supervision Division. This will allow the licensing to be completed within five to 10 business days.
Previously, all applications were approved during the Authority’s weekly Management Committee meetings.
The Class C license category under the Insurance Law captures entities that provide reinsurance through the issuance of insurance-linked securities, such as Cat bonds, sidecars, collateralized reinsurance or similar instruments.
The division has also been given the power to approve “renewals” of analogous Cat bond licenses within five to seven business days.
CIMA noted in a statement, “The issuance of licenses at a divisional level is not new to the Authority. Currently, all funds licenses and registrations including portfolio insurance companies are issued at the divisional level.
“In conjunction with these recent changes, a new standalone licensing policy for the Class ‘C’ insurer category will also be developed. This will clearly outline the criteria and procedure for issuing such licenses, and help to mitigate any associated risks.”
CIMA Managing Director Cindy Scotland said, “This fast-track licensing process is another testament towards CIMA’s efforts in accommodating sophisticated solutions within the financial industry, while maintaining our obligation as a regulator.”