11 November 2016News

Exclusive: Bermuda re/insurers split on potential impact of Trump

Bermuda’s re/insurers are closely divided on the question of if the election of Donald Trump as President of the US will be good or bad for the Bermudian re/insurance industry, according to an exclusive poll by Bermuda:Re+ILS.

The poll found that 53 percent of respondents thought that Donald Trump would be bad for the industry and that 47 percent thought that he would be good.

Some of the comments coming from the negative camp included that they thought that Trump’s attitude would be protectionist and that he would promote protectionism for domestic US re/insurers.

One respondent said that: “Lower US corporate tax and greater penalties for inversion will discourage new market participants [from choosing] Bermuda.” Another said that Trump was too unreliable and not consistent.

And one respondent pointed out that: “If President Elect Trump follows through on his tax cutting initiative he will be seeking other revenue streams, including taxes on offshore entities, where US jobs will not be affected. The effect of his taxation plan on offshore entities will also return jobs to the US.”

The comments from the positive side were naturally more optimistic. One said that US growth would now accelerate, whilst another that Trump would promote change and competition in the industry.

According to one: “We are more likely to see a pro-growth agenda, resulting in higher economic growth and higher interest rates - both good for the industry.  And I think that any increasingly protectionist trade policies are likely not to be focused on insurance.”

Another was a little more gnomic: “I feel many will want their insurer/reinsurer in a stable domicile other than the US.  Bermuda is the perfect place to achieve that goal.”