Bermuda-domiciled carriers’ resilience to catastrophe events has shown consistent year-on-year improvement with capital level growth exceeding gross catastrophe exposure, according to a recent report from the Bermuda Monetary Authority (BMA).
While gross catastrophe exposure for Bermuda’s reinsurance sector increased by about 9% year-on-year, capital levels also increased at a slightly higher rate.
“Bermuda is predominantly an insurance-based international financial centre specialising in the niche of catastrophe reinsurance and is host to the third largest reinsurance market in the world,” said Craig Swan, Managing Director, Supervision (Insurance).
“Overall, this year’s results again highlighted the industry’s resilience to major, but improbable, catastrophe events and the diversity of modelling practices in Bermuda. This underscored the reputation of Bermuda insurers as being generally well-capitalised,” he added.
The global share of gross estimated potential loss assumed by Bermuda’s re/insurers for major catastrophe perils increased by about 2% overall.
Out of an estimated total industry loss of $125 billion for a Miami-Dade Hurricane, the Bermuda market’s share would be around 13%, or $15.9 billion, up 2% year-on-year from the 11% Bermuda share reported in 2015.
The 2016 Catastrophe Risk Report doesn’t include Bermuda’s alternative capital market data.
Bermuda is predominantly a re/insurance-based international financial centre specialising in catastrophe reinsurance, and is host to the third largest reinsurance market in the world.
Last year’s results underscored the industry’s resilience to major, but improbable, catastrophe events and the sophistication, advancement and diversification of the modelling practices in Bermuda.
The report’s findings show positive development in the reinsurance domicile, which experienced considerable uncertainties earlier this year surrounding the Trump administration’s pending tax reforms and the suggestion of an imposed border tax.
