2013-12-09 11:33:26 - Fast Market Research recommends "Bermuda Insurance Report 2014" from Business Monitor International, now available
Our main conclusions about Bermuda's formidable insurance sector remain unchanged from our 2013 annual report. The island is the world's premier offshore insurance centre and it is expected to remain so for the foreseeable future. Other jurisdictions have had success in attracting international insurers or captives, but none has, over time, developed an insurance sector that is home to several of the world's largest and most sophisticated underwriters, an extraordinary variety of captives and a truly central position in the coverage of risk worldwide.
That Bermuda has reached this position is partly the result of good luck - given its lack of income tax and close proximity to (re) insurable risks on the east coast of the US - and largely
the consequence of constructive collaboration between the government, the Bermuda Monetary Authority (BMA, which is the central bank and a highly effective regulator) and the various protagonists in the insurance sector.
Full Report Details at
One consequence is that Bermuda's extremely large insurance companies focused on third-party (re) insurance business - as opposed to companies that are substantially or totally captive insurers - are well capitalised and appear to be cope well with surges in catastrophe-related claims. These companies also appear well placed to deal with the challenges thrown up by the EU's Solvency II regime. This is partly because the BMA's own requirements are very demanding and partly because Bermuda's standing as an offshore business centre is not affected by a sovereign debt crisis. The only challenge that would really shake the Bermudian insurers would be a financial markets meltdown - and even then they would be better placed than their counterparts in most other countries.
The reports from the leading listed (re)insurers in relation to H113 highlight a number of positive trends. Profitability has surged thanks to falls in combined ratios. In essence, the return of catastrophe losses to 'normal' levels remains consistent with a firming in prices and rates. Because of their ability to handle specialist risks, the Bermuda companies naturally have greater pricing power than many of their rivals, anyway. Some of the leaders have achieved double-digit returns on equity in the first half of the year.
Life (re) insurance is something of a positive wildcard in an insurance sector that continues to be dominated by offshore (re) insurance and captives. Traditionally, Bermudian companies have not been in the business of manufacturing and distributing sophisticated savings products. However, the biggest players have reported growth in their life operations. Given the trends in the Asia Pacific region and some emerging markets, this can continue. Many of the world's leading life companies are also booking business through their Bermudian subsidiaries and will continue to do so.
Report Table of Contents:
BMI Industry View
- Table: Total Premiums, 2010-2017
- Table: Life Premiums, 2010-2017
- Non Life
- Table: Non-Life Premiums, 2010-2017
Industry Risk Reward Ratings
- Developed States Insurance Risk/Reward Ratings
- Table: Developed States Insurance Risk/Reward Ratings
- Bermuda Insurance Risk/Reward Ratings
- Table: Bermuda's Insurance Risk/Reward Ratings
- Non Life
Industry Trends And Developments
- Table: Insurance Key Drivers, Demographics 2010-2017
- Non Life
- Table: Bermuda Macroeconomic Data And Forecasts 2010-2017
- Table: Developed States Regional Security Ratings (scores out of 100, with 100 the best)
- Table: Trade Associations In Bermuda
- ACE Group
- Catlin Group
- XL Group
- Developed States Life Sector Overview
- Table: Developed States Life Premiums, 2010-2017
- Developed States Non Life Sector Overview
- Table: Developed States Non Life Premiums, 2010-2017 (US$mn)
- Industry Forecast Methodology
- Risk/Reward Rating Methodology
- Table: Insurance Risk/Reward Ratings Indicators
- Table: Weighting Of Indicators
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