This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred.
The Bermuda Monetary Authority (BMA) has confirmed that it plans to release a consultation paper in the fourth quarter of 2025 regarding the establishment of a new special purpose insurer (SPI) that will primarily focus on the use of parametric triggers.
We reported earlier this month that the BMA was in the final stages of implementing a new SPI, when Taijaun Talbot, Assistant Director, Supervision (Insurance) BMA, made the announcement at this year’s ILS Bermuda Convergence conference.
In a press release, the BMA said: “Leveraging its recognised Special Purpose Insurer (SPI) framework, the Bermuda Monetary Authority is intensifying efforts to close the protection gap associated with climate change and underserved emerging risks by pledging to issue a Consultation Paper in the fourth quarter 2025 on a new SPI framework tailored for parametric products.”
As the scale and frequency of natural catastrophe events shift globally due to a range of climate factors, the insurance industry continues to experience a widening gap between insured losses and actual damage from nat cat events.
The BMA also noted that this is further compounded by emerging risks beyond nat cat, such as cyber threats.
“Recognising these challenges, the Authority believes developing a fit-for-purpose framework for parametric insurance covers will be instrumental in growing a robust parametric insurance market,” the BMA said.
Adding: “A meaningful parametric market offers policyholders the potential to bridge gaps left by traditional indemnity insurance, while benefiting from expedited claims and payout processes that can strengthen their resilience after loss events.”
As the risk landscape continues to change, the BMA said that it remains committed to ensuring market solutions keep pace with policyholders’ needs.
“The Authority reaffirms its role in providing a credible and proven regulatory environment that supports continued innovation and resilience in Bermuda’s insurance sector,” the BMA concluded.
Bermuda Monetary Authority confirms plans for parametric SPI consultation was published by: www.Artemis.bm
Our catastrophe bond deal directory
Sign up for our free weekly email newsletter here.