Why Conning’s Busst is bullish on Bermuda
From the insurance investment professional’s perspective the Bermuda insurance market place is a great place to be — and appears to be on an upward track.
London-based Russell Busst has been a regular visitor to the island as the chief investment officer at Conning Asset Management, which is a specialist investment adviser for the insurance industry. Conning Asset Management was founded in 1912, is headquartered in Hartford and has a global presence, with offices in Purchase, London, Cologne and Hong Kong. They have more than more than 300 investment and research clients, and have focused on the insurance industry for nearly 30 years.
Their promotional materials state: “Our philosophy recognises that our clients’ portfolios have a purpose beyond the immediate challenge of producing investment returns; they exist to support insurance businesses.”
Mr Busst explained: “Conning are insurance specialists — their business is our business,” adding as investment specialists, the insurance industry is “in our DNA.
“A large portion of the assets run for the insurance industry are run by insurance specialists — and Conning is in the top three.”
Mr Busst was in Bermuda last week to meet with insurance industry clients, and while he was here talked to
The Royal Gazette about his impressions of the Bermuda market in the wake of the change of Government in December.
“Clearly the approach of the One Bermuda Alliance in the very early days is seen to be pro business, and it appears that changes in the rules for start ups and the employment of overseas individuals appear on the face of it to be very positive in regard to business coming to Bermuda.”
Additionally, he said Bermuda’s progress towards Solvency II regulatory equivalence is positive. The planned relocation of A listed Lloyd’s of London insurer Randall & Quilter to the island is an example of how that has worked for Bermuda, because their move was inspired mainly by the uncertainty around Solvency II rules on capital requirements.
Other European insurers have also threatened to redomicile, including Prudential.
“The BMA has have put in a very good framework regarding Solvency II equivalency. It satisfies the way the rest of the world looks at you — without a doubt.”
He also cited the fact Bermuda is regarded as a risk management centre. “The business model is different from the US and Europe,” he said, and cited the lack of legacy issues and the resultanting ability of the business environment to be more innovative.
He said the Bermuda advantage in respect to the ability for start-ups to get up and running quickly remains the case for sidecars and other vehicles.
“I really felt a couple of years ago that Bermuda had reached a watershed. Insurers started moving to domiciles away and I’m guessing a number had contingency plans — who knew what the new political framework was going to look like?” he asked.
Instead, he said: “This is the first time we (Conning) are running a conference here in six or seven years. The growth of our business now is such that we will be having conferences on a regular basis.”
And Bermuda will benefit economically, he said. “We will be hosting 100 people with dinners, social events, golf days — it should have a significant impact.
“Now, we can do that.”