Norfolk’s central organisational principle is to give its clients an equity participation in Norfolk’s shareholding structure. Clients participating in the structured programmes are issued preferred shares. Each block of shares is made up of a distinct class of non-voting preferred shares with dividend entitlement related to the insurance business of that particular client.
These preferred shares provide the capacity to write insurance business and ensure compliance with solvency requirements. In subsequent years the retained profits in each cell could supplement solvency requirements for writing higher premium volume or increased risk retention within the insurance programme. In the event that excess reserves exist, retained profits are returned to the shareholder in the form of dividends or return premiums.
Commercial certainties and protection are codified through a Private Act by the Bermuda Legislature entitled ‘Norfolk Reinsurance Company Limited Act 1999’.