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Bermuda's Leaders Part II - Service Providers & ILS Specialists 2016

Re, also believes that Bermuda will remain one of the leading global risk transfer markets for many years to come. As well as agreeing on the importance of its regulatory regime, he notes that it has a proven history of anticipatory and innovative product development. “The Bermuda re/insurance market has  also thrived in large part due to the entrepreneurial spirit the country has fostered through its pro-business regulatory environment,” he says. He adds: “Bermuda has been at the forefront of product development since the early days of the country’s re/ insurance market. This is largely due to its entrepreneurial spirit, on-Island technical underwriting capabilities and a legal and regulatory business environment that understands and supports the re/insurance market. I believe Bermuda will continue to evolve and remain the preferred location to conduct business as the global risk transfer landscape adapts and changes over time.” Ernest Morrison, managing director and head of the corporate and commercial department at law firm Cox Hallett Wilkinson (CHW), stresses the enhanced reputation and credibility Bermuda has gained in recent years and the importance of this going forward as it copes with change and competition on several fronts. “The hard work and collaborative efforts of the Bermuda government, the Bermuda Monetary Authority (BMA), industry leaders and agencies such as the Bermuda Business Development Agency have reinforced the perception that Bermuda is not just another offshore financial centre but is a stable, yet innovative, leader in the re/insurance and ILS sectors, with a proven track record and a credible regulator, as now demonstrated by Solvency II equivalence and by the designation by the US National Association of Insurance Commissioners of Bermuda as a ‘qualified’ jurisdiction,” Morrison says. “The continuing development of new and innovative solutions for customers emanating from Bermuda is a function of the substantial depth of the intellectual capital present on the Island.” He believes future growth and success will come from several sources, but especially ILS. But he also foresees some challenges ahead. “We expect M&A activity in the reinsurance space will continue due to commercial pressure and the lack of organic growth options. Although it may slow down from the levels previously seen, we foresee that many companies will be looking at their options. “In 2015, there were more than 20 major transactions, including the high profile acquisition by Exor of PartnerRe (CHW acted for Exor). While this transaction was an investment by a new player in the insurance space many, ROMIANA LEE / SHUTTERSTOCK.COM BERMUDA’S LEADERS PART II Donald Kramer, the founder, chairman and managing partner of ILS Capital Management (he previously founded Ariel Reinsurance and was CEO of Tempest Re), describes Bermuda as the dominant reinsurance centre in the world and stresses that he believes it will retain this mantle as the risk transfer landscape continues to change. Kramer gives a number of reasons for this. The first is that Bermuda has established a strong and knowledgeable government regulatory oversight department. “It keeps the business safe and secure.  In many other jurisdictions compliance has become excessively intrusive and overly expensive without necessarily improving results,” he says. “The second is that Bermuda has become a centre for reinsurance talent, both imported executive talent and a large number of domestic employees and executives who have been well trained,” he explains. He also stresses the importance of the geographic location of Bermuda with its proximity to the US and its direct flights to the UK. He believes the biggest growth area for the Island in the future will be ILS, but warns of challenges ahead. “The principal challenges are the global economy coupled with advanced technical knowledge. Certain risk areas will change while others will emerge. Interest rates do not seem likely to advance materially over the next several years, although a modest rise in rates seems inevitable,” Kramer says. Frederick Pagnani Jr, chief executive officer of Mt. Logan 5 2016 Bermuda:Re/insurance+ILS


Bermuda's Leaders Part II - Service Providers & ILS Specialists 2016
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