After four years of falling premium income, Bermudian insurers and reinsurers saw their premiums written in 2012 increase to $120.49 billion compared to $107.60 billion in 2011, according to Axco Insurance Information Services.
The situation continued to improve in 2013, with the Bermuda Monetary Authority (BMA) registering 91 new insurers in 2013 compared to 53 in 2012.
Axco’s Bermuda country report also revealed a dramatic increase in the issuance of insurance-linked securities (ILS).
Fifty one special purpose insurers were set up in 2013 compared to 27 in 2012. Out of the $21 billion ILS issuance worldwide, $9.2 billion was introduced into Bermudian entities.
The current market situation has also led to significant expectation of another wave of mergers and acquisitions as small- and medium-sized players compete in an increasingly challenging marketplace, added Axco.
Tim Yeates, business development director at Axco, commented: “Although excellent news for the region, the overall growth in premium income is mainly due to the formation of new sidecars and CAT bonds which reached pre-crisis levels in 2012 and masks the continuing soft market in almost all classes.”
“However, the ongoing sluggish global economic recovery as well as a low interest environment has done nothing to dampen the speculation that another wave of mergers and acquisitions for is on the way for small to medium sized—a true sign of an increasingly challenging marketplace.”
