ABIR welcomes UK government’s ILS plans

The Association of Bermuda Insurers and Reinsurers (ABIR), has welcomed the UK government’s plans to develop an insurance-linked securities (ILS) regime in the UK.

The plans were revealed by George Osborne, the UK Chancellor of the Exchequer, yesterday (Wednesday March 18) in his final budget speech before the May election.

Bradley Kading, the president and executive director of ABIR, applauded the decision and added that the next challenge for ILS is to grow into new markets.

He said: “As Lloyd’s chair John Nelson said, Bermuda and London are both trusted competitors and partners. ABIR members provide 24 percent of the capacity to the Lloyd’s market and have about £4 billion invested in 16 UK subsidiaries.

“We welcome the UK into the ILS market which further expands our business connections. The challenge now is to grow markets. The UK has set a good example with the reinsurance purchases for Flood Re and Pool Re.

“In the US Florida is leading the way with its substantial depopulation of the Citizens Property Insurance Corporation and its $4 billion plus risk transfer purchase. We need to work to eliminate restrictions on cross border trade and increase insurance penetration in Africa, Asia and Latin America.  Let’s put this new capital to work.”