Bermuda needs to promote itself better
Bermuda remains the pre-eminent jurisdiction for captive insurance but has fallen behind in promoting the jurisdiction internationally in the face of growing competition.
Those were the sentiments expressed by a panel of industry experts discussing ‘Setting the Standard in Jurisdictional Excellence’ at the 20th annual Bermuda Captive Conference.
Moderator Grainne Richmond, Executive Vice President, Head of Captives, Aon & President, Bermuda Captive Network was joined by three visiting panelists Matt Aulds, VP Finance & Legal, Sensible Weather, Heidi Lawson, Equity Partner, Fenwick & West, Andrew Weisman, Managing Director, Global Head of Risk & Insurance Management, Morgan Stanley and Bermuda-based Shivani Seth, Business Podcaster, RG Navigate & Director, Bermuda Econmic Development Corportation (BEDC).
The panel agreed that Bermuda was the blue-chip jurisdiction for captives for many reasons including the excellent regulator, the BMA, as well as the flexibility where captives can increase their capitalisation to become a fully licensed commercial carrier.
Bermuda’s Solvency II status and the ability to write risks almost anywhere in the world were also touted as advantages over other jurisdictions.
But Lawson said Bermuda was not as visible as some of its competitors.
She said Bermuda often rises to the top of the list of domiciles because of its flexibility and credible regulation, but added: “One thing I have to say about the other jurisdictions is they are out there marketing. One of the things we’ve really noticed at the World Captive Conference and other conferences is, Bermuda is not there.
“And I think that’s really been missing the last couple of years because of the message about the flexibility, and particularly for the technology companies.
“The flexibility, all the points that I made earlier, are so important to companies but there’s no voice. When we’re going around to the different captive conferences in the United States, we’ll see other international jurisdictions, but we don’t see Bermuda.”
Captive managers also pointed to the importance of reputation, especially for technology clients who seek a jurisdiction that has robust regulation, which sometimes might seem counterintuitive, but credibility is key.
Another advantage is the critical mass of expertise in Bermuda with a very strong and deep franchise of experts across the entire advisory spectrum including legal, regulatory, accounting, and a wide variety of lines of business.
The panel said it was an advantage to be able to call the regulator directly to discuss proposed ideas or meet with a local expert across the street.
Bermuda has not only a thriving captive market but also a long history in the Property and Casualty reinsurance and insurance markets, deep expertise in casualty risks, and more recently a large life and annuity reinsurance marketplace as well as being the world leader in Insurance Linked Securities (ILS).
Innovation was another advantage with companies able to manage their risks through mechanisms such as the BMA Sandbox, which is supervised by the regulator and once approved can be quickly implemented.
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