Minister of Education, Sports and Recreation Randolph Horton moved to reassure reinsurers that Bermuda is still the place to do business in the wake of fears raised by business leaders over the current political climate and work permit problems.

Speaking on the first day of the 21st International Reinsurance Congress held at the Fairmont Princess Hamilton this week, Mr. Horton hit out at what he described as "myths" about the Island's present business environment, citing Ed Noonan, CEO of Validus and his depiction of the "financial reality" for companies in Bermuda as an accurate reflection of what is really going on.

Last week The Royal Gazette revealed international businesses in Bermuda were re-examining their exit strategies from the Island because of increased concerns about talk of corruption and problems encountered with work permit time limits, as reported in industry magazine Global Reinsurance.

The Royal Gazette also reported that Mr. Noonan's wondered how much of the disquiet was merely "bar talk."

Meanwhile, Mr. Horton went on to set out the Government's intentions to maintain Bermuda's place as the world's number one risk capital and its thriving international business industry.

"I especially appreciate when our difficult job is supported by words of encouragement mixed with reflections of honesty and sincerity from discerning reinsurers like Mr. Ed Noonan, CEO of Validus Re, who recently painted a picture of financial reality in Bermuda which dispelled many a myth," he said.

"It often seems like indeed there is a sea of counter comments, but the Government believes that the present financial marketplace makes the needs of reinsurers like Mr. Noonan, who see us as financially fertile and secure enough as a jurisdiction to provide confidence for growth."

He talked about the importance of Bermuda's reinsurance sector to other global markets and the role it plays.

"In light of the extraordinary activity that we have had in the reinsurance sector with the effects of hurricanes Katrina and Rita still reverberating on our balance sheets I want to pose a question - if American insurers had been restricted by regulation to buying insurance only from US reinsurers, what would have been the effect on the US reinsurance market and the primary insurance market?" he said.

"If the Bermuda reinsurance market did not exist, where would that $6 billion in claims payments have come from and what would the consequences be for the stability of the US economy?

"As events unfolded my question was relevant then and it remains relevant today as Bermuda reinsurers provide reinsurance capacity to the global financial system."

He went on: "We are all too aware that the consequences of mistakes and mis-handlings can have a catastrophic effect on our local economy, just as misinformation and baseless speculation can lead to the unnecessary rise and concern in our lucrative markets overseas. Failure to address any of these blips on the financial radar may lead to a major reinsurance collapse, the effects of which will be felt throughout the global financial system."

And Mr. Horton reassured reinsurance executives at the meeting that Bermuda's tight regulatory powers were keeping a close eye on what is going on in the country's industry.

He said Bermuda would continue to remain at the cutting edge of the reinsurance industry.

"A significant part of Bermuda's responsibility is also to provide you with a responsive environment and cutting edge infrastructure and to facilitate a group of peers utilising the latest technology.

"I note that speakers at the recent reinsurance rendezvous which took place in Monte Carlo commended many Bermuda reinsurers for being ahead of their peers, because those Bermuda reinsurers have advanced computer-generated catastrophe models, factored on the latest climate change effects which enable more accurate pricing of risk, while their competitors utilise models which have yet to be recalibrated.

"However, as an educator, I was pleased to note that the speaker also mentioned that skill, not raw science, still underpins reinsurance, and thus, reinsurance is still an art, an art form, learned, yet perfected by experience and enhanced by the latest computer catastrophe modelling. It was refreshing to hear from those reinsurers that have existed in Bermuda long enough to understand the immense challenges we face as a Government mandated by the people of Bermuda to match their overall desires with comparative performance."