Axco Insurance Information Services (Axco) has released its new Bermuda country report covering the international insurance market.
The report reveals that after four years of falling premium income, 2012 was the first year to show increased premiums written by international re/insurers registered in Bermuda. Gross premiums reached $120.4 billion in 2012, an 11 percent increase on $107.6 billion in 2011.
A slow global economic recovery, a low interest environment and the assumption that reinsurance does not correlate with other forms of investment has led to 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. In total, the Bermuda Monetary Authority registered 91 new insurers in 2013 compared to 53 in 2012. Out of the $21 billion ILS issuance worldwide, $9.2 billion (44 percent) was introduced into Bermuda-based entities.
The current tough market situation has also led to an expectation of another wave of mergers and acquisitions, as small and medium sized players compete in an increasingly challenging marketplace.
Tim Yeates, business development director at Axco, said: ‘Although there is 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.
Bermuda, insurance, reinsurance, gross premiums, BMA, Tim Yeates, mergers and acquisitions