The Bermuda Monetary Authority (BMA) has claimed that Bermuda reinsurers paid out $208.7 billion to US policyholders and cedants for large catastrophes, related property insurance and general liability losses over the past 20 years.
According to commercial market claims data collected by BMA from 1997 to 2006, claims payments to US policyholders and cedants totalled $56.0 billion and that between 2007 and 2016, this increased ‘significantly’ to $152.7 billion.
Looking at recent losses the BMA said that the devastating 2017 hurricanes Harvey, Irma and Maria (HIM) led to recorded estimated losses of $31.2 billion net of reinsurance costs for Bermuda (re)insurers. Of this amount, the US and Puerto Rico accounted for $30.6 billion net. Based on publicly available catastrophe loss estimates, Bermuda reinsurers will be picking up 30 percent of the Harvey, Irma and Maria losses from this record-setting hurricane season.
The data comes from the BMA’s first US Data Claims Survey completed in November. The loss information includes both direct insurance and reinsurance. A total of 250 companies responded to the survey including both commercial insurers/reinsurers and alternative capital entities and insurance linked securities funds.
“The $30 billion or 30 percent of US losses paid by Bermuda (re)insurers demonstrates the key role Bermuda plays in the supply of risk capacity to that country,” said Craig Swan, managing director, supervision (insurance). “In fact, the survey results show the significance of the Bermuda (re)insurance market’s contribution to the US over the past two decades. US insurers cede risk to Bermuda, diversifying that risk globally, making the cost of buying insurance – particularly property/catastrophe insurance – more affordable to customers living in US danger zones.
“The Authority is grateful to the companies that took part in the survey,” Swan continued. “This data and the European Union (EU) claims data released in September (over $70 billion was paid out by Bermuda reinsurers to EU policyholders and cedants over the past 20 years) demonstrates the valuable role Bermuda plays in diversifying risk globally in an increasingly competitive world marketplace.”
Bermuda Monetary Authority, Insurance, Reinsurance, Survey report, Bermuda