Google the flag of Cayman Islands. Note the color.
look at the flag on the yacht in this pic.
Would it were that simple. It all starts woth ships at sea. The Admiral (ruler of the sea) would identify his ship, hereafter the "flagship", by flying a distinctive flag.
Early in the 17th century the the Royal Navy this was the red ensign
As the fleet got larger is was divided into squadrons
The Centre, commanded by the Admiral
The Van, commanded by a Vice Admiral
And the Rear, commanded be a Rear Admiral
When the fleet got larger, the squadrons became fleets in their own right and with 9 admirals of various grades it got comlicated
As the Navy got still larger, and by Nelson;s day there were even more admirals and it got really complcated
So it was simplfied. Navy ships would fly the White Ensign. Ships in Government Service not-Navy, the Blue. And Merchant Ships the Red Ensign.
However about this time, The British acquired an Empire and the various colonial departments began to use varianst of these ensigns (usually blue for government, red for NGOs)
This worked until the colonials demanded autonomy, and selected either a red or blue ensign variant as the Official flag. And it got complicated again. Where the red ensign became the autonomy ensign (eg Canada, Bermuda islands) it was clear - everybody flies the one flag)
But where the blue ensign was the autonomy ensign (eg Australia, Cayman Islands) the practice conformed to the original rules: government (ie Customs) ships are blue. Merchant ships are red. Private (ie non-comercial) may fly either the red ensign or the blue national ensign.
And this is why when you google Cayman Islands flag it comes out their official blue, while Cayman Islands registered yachts can be flying either a blue or red ensign.
There's a reason the sunject is called Vexillology.