Bermuda urged to lead on closing global protection gap as risks intensify
Bermuda’s role as a global hub for risk transfer and innovation came into sharp focus at the ABIR Risk Forum 2026, which took place in Bermuda this week, as industry leaders gathered to address a number of issues including the widening gap between rising climate losses and available insurance protection.
Opening the event, ABIR chair Mark Cloutier stressed the increasing importance of the sector in a rapidly evolving global economy. He said that in a “deeply interconnected” world, insurance has shifted from being an optional safeguard to a “fundamental, indispensable component” of economic stability and growth.
The industry, he noted, plays a critical role in enabling trade, managing risk and providing capital at a time when both natural and man-made threats are escalating.
That theme was picked up and expanded upon by Bermuda’s Governor Andrew Murdoch CMG, who delivered a stark assessment of the challenges facing the global insurance and reinsurance market.
“The reality is stark. Climate related losses are rising yet insurance is not keeping pace. Closing the gap is a societal imperative,” Murdoch said, pointing to the growing number of communities, businesses and governments exposed to extreme events without adequate financial protection.
He emphasised that the protection gap is no longer solely an industry issue, but one that requires coordinated global action, with reinsurance playing a central role in extending coverage and building resilience.
Murdoch argued that Bermuda is uniquely positioned to lead that effort, citing its concentration of expertise, capital and regulatory agility. He described the island as a “global leader in insurance reinsurance, risk transfer, and resilience”, underpinned not only by scale but by a distinctive mindset centred on adaptability and decisive action.
That ability to respond quickly to emerging risks, he suggested, is deeply embedded in Bermuda’s culture and has been instrumental in its development as a world-class reinsurance hub. The island’s collaborative ecosystem, bringing together actuarial, underwriting, legal and risk management expertise, allows it to mobilise capital and solutions rapidly in response to major loss events.
Murdoch highlighted the need for innovation to address the protection gap, pointing to the growing importance of alternative risk transfer mechanisms and new product development. “Parametric 2.0 and other products need creating as part of a global response,” he said, underlining the role of public-private partnerships, catastrophe bonds and capital markets in expanding coverage.
The discussion comes at a time when climate-related losses are increasing in both frequency and severity, while insurance penetration in many regions remains limited. This imbalance is placing greater pressure on governments and economies, and raising questions about how the industry can scale solutions to meet demand.
Speakers at the forum pointed to the need for a more coordinated approach, combining innovation in product design with improved access to capital and stronger collaboration between insurers, reinsurers and public sector stakeholders.
Bermuda’s ability to act with regulatory responsiveness was also highlighted as a key advantage. Its relatively small size allows for agility in adapting frameworks and supporting innovation, creating an environment where new ideas can be tested and brought to market more quickly than in larger jurisdictions.
Murdoch suggested that this combination of expertise, trust and speed gives Bermuda both an opportunity and a responsibility to lead on the most pressing challenges facing the sector. He said the island’s track record in responding to major events demonstrates how effective collaboration can deliver meaningful outcomes, but warned that more needs to be done to extend protection to underserved regions.
The Association of Bermuda Insurers and Reinsurers (ABIR) represents Bermuda’s major property and casualty insurers and reinsurers. The event was supported by ABIR member companies and event partners KBRA, Bermuda Business Development Agency (BDA), and Deloitte, along with education partner The Institutes Knowledge Group.
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