Bermuda Seeks To Tap Insurance Sector Growth
by Mike Godfrey, Lowtax.net, Washington
01 April, 2014
Bermuda is expanding its share of the insurance-linked securities (ILS) and reinsurance market, and hopes to tap future growth, according to the Bermuda Business Development Agency.
The BDA said that Bermuda is paying close attention to the ILS and reinsurance market, with 70 industry executives from the island traveling to New York recently to attend the Security Industry and Financial Markets Association's (SIFMA) 2014 IRLS Conference. The market is expected to grow to be worth about USD144bn in the next five years, according to reinsurance intermediary Aon Benfield.
The BDA said that 44 percent of the worldwide stock of ILS is now listed in Bermuda. In the fourth quarter of 2013 alone, Bermuda attracted more than two thirds of all ILS issued (USD1.3bn of USD1.9bn).
BDA interim CEO David Cash, commenting on the potential of the ILS industry, said: "The projected growth of ILS will directly benefit Bermuda as businesses will be required to increase capital spending by hiring people and services in order to meet client needs. This in turn affects our economy through increased consumer consumption and spending. Government revenues will also increase, thus growing Bermuda's overall GDP. We've seen the economic benefits derived from our insurance, reinsurance, and captive businesses. ILS presents a similar opportunity and the BDA is focused on enabling this growth."
At the end of 2013 the Bermuda Stock Exchange saw a record volume of USD9.7bn insurance-linked listings with this value predicted to grow further in 2014.
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