The next phase of growth for Bermuda’s life reinsurance sector will depend partly upon the market’s ability to replace or rotate early-investor capital, delegates at the PwC Insurance Summit heard.

In the space of a decade, the market has grown from almost nothing into the world’s largest reinsurer of life and annuities, backing hundreds of billions of dollars worth of pensions around the world.

As of the end of September 2025, Bermuda’s long-term insurance sector had more than $1.5 trillion of assets under management, according to Bermuda Monetary Authority figures.

Matthew Roche, president of Serenova Re, said he expected the market to keep attracting capital, provided the returns met investors’ expectations, with the buildout of a strong regulatory framework an important strength.

“I have a lot of confidence that it will be here for the long term, especially given all the knowledge and the track record that’s been building over the past few years,” Mr Roche said.

Looking ahead, innovation was key to future success, he added.

“Our market here barely existed around ten years ago — it came about largely through innovation of the people doing these transactions,” Mr Roche said. “It's going to be important to keep building on that and you can see some reasons why we're going to need that.

“For example, investor time horizons, as some of the initial capital that was deployed in this sector, maybe five or ten years ago, that’s going to start coming to the end of its life cycle.

“There will need to be rotation, new structures, new investors coming in, potential M&A. I think that's all going to need innovation here.”

Cynthia Smith, chairwoman and chief executive of Chariot Re, said that Bermuda had attracted about 84 per cent of all life and annuities reserves outsourced overseas by life insurers. She attributed much of that to the work done by financial services regulator the Bermuda Monetary Authority.

“They have built an incredible brand that's based on discipline, collaboration, transparency,” Ms Smith said. “That’s a really important around why people feel good about being here on the island.”

The BMA’s rigorous due diligence aimed at ensuring life reinsurers’ investments were appropriate for their liabilities was positive for the jurisdiction, despite creating hurdles to clear for companies conducting transactions.

“Having that sort of regulatory body is good for business for the long term,” Ms Smith said. “It keeps the bad actors out and, from a competitive perspective, it keeps an even playing field for how people can operate and do things in a way that's responsible.”

Tom Ault, CEO of Legal & General Re, backed up that point of view.

“I've seen huge amount of expansion in this market over the last ten years,” Mr Ault said. “We’ve seen a large number of new players and new entrants and the regulatory environment has transformed over that period.

“The BMA has kept up with the innovation and change that's happened and it's a good regulator to work with. We look forward to what the next ten years can be. It probably will not see the same amount of growth again that would be quite difficult to do.

“But the innovation and the new markets and the new opportunities that Bermuda can support around the world, I think it’s just going to grow. What that needs to happen is the confidence of the market and the story of Bermuda being a stable, successful, and growing market supporting that.”

Moderator Todd Coslow, director of policy and regulation for Bermuda International Long Term Insurers and Reinsurers, summarised: “The common thread here is sustainable growth is supported by strong risk management and effective supervision with policyholder obligations at the centre.”