BMA: Insurance Sector Achieves Strong Results
The Bermuda Monetary Authority today [Mar 27] said Bermuda’s insurance market “maintains its resilience,” writing over $100 billion in premiums.
Shelby Weldon [pictured], Director of Licensing and Authorisations at the BMA said the market’s resilience was reflected in its consistent performance.
“Bermuda’s insurers continue to write significant volumes of premiums and hold substantial amounts of both assets and capital and surplus,” he said.
“The volume of business being written here and the quality of our firms show that Bermuda remains one of the world’s premier insurance domiciles.”
The BMA said that Bermuda’s insurance market continued to manage the impacts of the global economy and market conditions effectively.
“The latest available statistics show that the market recorded similar year-on-year aggregate gross premiums written of $107.6 billion; net premiums written were $94.6 billion,” said a statement from the BMA.
“Overall, the market recorded aggregate capital and surplus of $168.7 billion and held total assets of $452.2 billion. Gross premiums written by the commercial sector was $87.3 billion.
“Total assets for the commercial sector were $366.9 billion, while capital and surplus was $126.6 billion. The captive sector wrote $20.3 billion in gross premiums and reported total assets of $85.3 billion; reported capital and surplus for this sector was $42.1 billion.”
Mr. Weldon said the market environment has become increasingly competitive, particularly in the captive space, but Bermuda clearly has the ability to attract quality business.
“Bermuda remains the largest domicile in terms of active captives – a total of 856 as of the end of 2012,” Mr Weldon added.
“We are continuing to see new captive business choosing to locate here, based on our experience, both in terms of the practical regulatory environment and professional service providers on the ground catering to captives, as well as unparalleled access to a sophisticated reinsurance market.”
The BMA also recently announced that Bermuda will not be applying any Solvency II-type regime to the captive sector.
“The jurisdiction also recorded a range of new insurer registrations – a total of 53 for 2012 – largely driven by 27 new Special Purpose Insurers [SPI]. Bermuda is increasingly becoming a global centre for the creation, listing and servicing of Insurance Linked Securities (ILS) that are sponsored by SPIs”, the BMA said.
“Having put in place the regulatory framework for SPIs in 2009, we are pleased to see initial interest now translating into active business,” Mr Weldon said. “The total volume of new ILS issued globally in 2012 was $6.4 billion with $2.5 billion, or 40 percent, of this total being sponsored by Bermuda-registered SPIs.
“Overall, SPIs provide another alternative risk transfer option which builds upon Bermuda’s longstanding expertise in this area. The jurisdiction is committed to servicing this growing segment of the market.”
Mr. Weldon added, “We are also pleased to see increased registrations in the Long-Term space. We registered nine new Long-Term firms in 2012, compared to three in 2011.
“This increase shows that Bermuda is still very much open for life insurance business. One of our priorities is to ensure this sector continues to benefit from proportionate regulation that remains workable for both the market and the regulator.
“In fact, that will continue to be the case for our regulation for the insurance sector overall,” he continued. “Bermuda remains attractive due to our unique position of being able to service the full spectrum of insurance: from commercial insurers, to captives, to Long-Term firms.
“There is a collective commitment from the Authority, service providers, and the market to continue providing quality regulation and service standards to the insurance sector.”
