Bermuda’s ILS advantage is hard to replicate: BMA panel
Bermuda’s long-standing role in the development of the insurance-linked securities (ILS) market was once again in focus as industry leaders examined how the jurisdiction has evolved into a globally trusted hub for alternative capital and complex risk transfer.
Speaking during the “Investment Fund Panel: Bermuda as a Trusted Global ILS Marketplace” at the 2026 BMA Forum, entitled “Charting the Course: Managing Risk and Complexity in a Rapidly Evolving Landscape”, which took place in Bermuda in early April, participants highlighted the island’s unique combination of regulatory credibility, market maturity and execution capability.
The session brought together Mellisa Burgess, director, supervision (insurance), Bermuda Monetary Authority, as moderator, alongside panellists Kathleen Faries, CEO, Artex Capital Solutions; JP Dyer, chief legal officer, Nephila Capital; and Matt Ebbs-Brewer, partner, Appleby (pictured left to right, respectively).
At a high level, the discussion centred on how Bermuda has transitioned from a traditional investment fund domicile into a sophisticated, globally recognised marketplace for ILS and alternative risk strategies. That transformation, panellists indicated, has been driven less by a single innovation and more by the gradual accumulation of structural advantages, legal, regulatory, technical and human, that together enable the efficient formation and scaling of complex risk vehicles.
Bermuda’s origins as a reinsurance hub were repeatedly referenced as a critical foundation. Over decades, the jurisdiction has built deep expertise in underwriting, risk modelling and capital deployment. That expertise has naturally extended into the ILS space, where investors require confidence not only in the structures themselves but also in the broader ecosystem in which those structures operate.
A key theme was that Bermuda offers more than administrative efficiency. While the jurisdiction is well known for its ability to facilitate fund formation and execution, its value proposition has increasingly shifted towards trust and institutional confidence. For global investors allocating capital to ILS strategies, that trust is underpinned by a regulatory framework that is both well established and widely understood.
The panel also pointed to the importance of legal certainty. Bermuda’s legal system, rooted in English common law and supported by the Privy Council as the final court of appeal, provides a familiar and reliable environment for international investors. This continuity has helped reduce friction in capital raising and deployment, particularly for institutional investors who require clarity on governance, enforceability and risk.
Equally important is the jurisdiction’s regulatory model. Bermuda’s approach, often described as responsive and pragmatic, has evolved in step with market developments. The ability of the Bermuda Monetary Authority (BMA) to oversee insurance, reinsurance and investment funds within a single regulatory framework was highlighted as a distinct advantage. This integrated oversight allows for alignment across disciplines, enabling more efficient structuring of ILS transactions that sit at the intersection of these sectors.
That alignment is particularly relevant as ILS structures have grown more complex. What began as relatively straightforward collateralised reinsurance arrangements has expanded into a diverse set of products, including catastrophe bonds and more sophisticated risk-transfer mechanisms. The evolution of these products has required a regulatory environment capable of adapting without sacrificing rigour - a balance Bermuda has sought to maintain.
Another recurring theme was execution. Bermuda’s ability to deliver transactions efficiently remains a hallmark of the jurisdiction. Panellists noted that the speed and predictability of execution are critical for sponsors and managers seeking to raise capital and deploy it into risk-bearing structures. In a market where timing can be decisive, particularly following major loss events or periods of capital dislocation, this capability reinforces Bermuda’s attractiveness.
Behind this efficiency lies a mature ecosystem of professional services. Legal advisers, fund administrators, insurance managers and other specialists play a central role in structuring and operating ILS vehicles. The depth of this talent pool, built over many years, was described as a form of “muscle memory” that cannot easily be replicated by newer jurisdictions seeking to enter the space.
The availability of intellectual capital was also emphasised. While regulatory frameworks and legal structures are essential, they are only effective if supported by individuals with the expertise to implement them. Bermuda’s concentration of experienced practitioners allows for the practical translation of complex ideas into functioning market solutions.
Flexibility within the legal and regulatory framework was identified as another differentiating factor. Bermuda has introduced a range of structures, such as segregated accounts companies and limited liability companies, that provide sponsors with options tailored to their needs. This adaptability enables the jurisdiction to accommodate a wide variety of investment strategies and investor preferences, enhancing its appeal in a competitive global landscape.
The panel also touched on the importance of consistency and evolution. Bermuda’s frameworks have not remained static; rather, they have been updated over time to reflect changes in market practice and investor expectations. This iterative approach has allowed the jurisdiction to remain relevant as the ILS market has matured, while also preserving the stability that investors value.
Importantly, the discussion highlighted how Bermuda’s role extends beyond serving as a domicile. The jurisdiction functions as a marketplace in its own right, where capital, risk and expertise converge. This positioning is reinforced by the proximity of reinsurers, fund managers and service providers, creating an environment in which collaboration and information flow more freely.
The presence of a single regulator overseeing multiple aspects of the ecosystem further enhances this dynamic. By understanding the interplay between insurance risk and investment structures, the BMA is able to provide a level of insight and coordination that supports more efficient decision-making. This, in turn, contributes to the overall coherence of the market.
While other jurisdictions are seeking to replicate elements of Bermuda’s model, the panel suggested that its advantages are cumulative and time-dependent. Building a comparable ecosystem requires not only regulatory and legal infrastructure, but also the development of expertise and trust over many years. In this sense, Bermuda’s leadership in the ILS space reflects both its history and its continued ability to adapt.
Overall, the discussion reinforced the idea that Bermuda’s success in ILS is rooted in a combination of factors rather than any single attribute. Regulatory credibility, legal certainty, execution efficiency and a deep talent base all play a role in supporting the market. Together, they create an environment in which complex risk-transfer solutions can be structured, scaled and trusted by global investors.
Did you get value from this story? Sign up to our free newsletters and get stories like this sent straight to your inbox.
