Characterizing Bermuda as “the hub for the American market,” and boasting about having 12 of the world's top-40 reinsurers, Bermuda's premier vowed to keep a “low regulatory burden” for new companies without sacrificing the island's successful focus on preventing financial crime.

“Only the Germans and the Americans top Bermuda with premiums written among the top-40 reinsurers worldwide,” Premier Ewart F. Brown told an audience gathered here for the fourth annual Bermuda Captive Conference. “The insurance sector has helped sustain our GDP growth, at 4 percent per annum since 2000–consistent, steady, sensible growth.”

He cited a study released in May–”The Bermuda Insurance Market: An Economic Analysis,” by J. David Cummins of The Wharton School at the University of Pennsylvania and The Fox School at Temple University–which cites Bermuda as one of the world's top-three jurisdictions in the global reinsurance market, along with the United States and Europe.

The report added that “Bermuda's importance in this regard has accelerated during the past few years.”

The study found that 12 Bermuda reinsurers appear in the list of the top-40 reinsurers worldwide–the largest number from any jurisdiction. “Bermuda is the leading non-U.S. supplier of reinsurance to U.S. insurers, providing a critically important source of risk capital for the U.S. market,” the report said.

According to the study, “new capital continues to flow into Bermuda on a regular basis, especially in response to large loss events in the U.S.”

“Clearly our industry foothold is strong, and we are focused on re-cementing that position,” said Premier Brown. “Through continued, prudent governance, I am personally committed–as is the finance minister–to a low regulatory burden for new companies.”

Conventional wisdom, he added, “might suggest that such a strategy would have companies of inferior quality,” but he noted that Bermuda's regulatory environment in fact attracts only companies of “superior strength and stability.”

Premier Brown said this is a testament to Bermuda's policy of “full cooperation in legitimate financial crime investigations.”

Last year, he said, U.S. Consul General Gregory Slayton and he “sat in a meeting with U.S. Treasury Deputy Secretary [Robert M. Kimmitt] and his staff. They voiced genuine appreciation for Bermuda's documented cooperation in suspicious financial activity investigation.”

Premier Brown said that Mr. Kimmitt and his staff expressed gratitude for Bermuda's continuing effort to “disrupt international terrorism dealings,” adding that “people around the world know about Bermuda's commitment in this regard.”

Premier Brown said he will meet again with U.S. House Ways and Means Committee Chair Charles Rangel, D-N.Y., “and these are the sorts of things we will talk about.”

He said he believes Bermuda's position is tremendously important to American citizens, “especially the millions living along America's coastlines. As you know, Bermuda's place in the global insurance marketplace has consistently grown.”

Premier Brown added that with growth has come added competition from other captive insurance domiciles–including Dublin, Dubai and Vermont. “So many jurisdictions seem to be upping the ante,” he said, noting that “even with that being the case, we like our position.”

International insurers are using regional hubs to reach local markets, he noted, pointing out that Dublin is a hub for Europe, Dubai for the Middle East and Singapore for Asia. Meantime, he said, “Bermuda is the hub for the American market. We are uniquely positioned geographically. Just like real estate, there is no substitute for location.”

Premier Brown also stressed the importance of Bermudians' involvement in shaping the industry's future, citing participation by the Association of Bermuda Insurers and Reinsurers, as well as the Bermuda Insurance and Reinsurance Brokers Association.

He said his country is improving its education system while working with industry partners to mentor and prepare young Bermudians for “a bright career in the country of their birth.”

Mr. Brown stressed the importance for locals' involvement in the industry, “because often the insurance industry is perceived in our community as an unreachable plateau for a select few, and everyone else is a spectator to that success.”

Unless Bermudians feel their country's “most lucrative business can provide them with fair opportunities, we are in a socially dangerous space,” he concluded.

Special Reports /

Bermuda Premier Vows To Keep Island's 'Low Regulatory Burden' For New Insurers

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