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Sun shining again on island’s re/insurance industry

Success story: the re/insurance industry has become even more improtant to Bermuda during the pandemic (File photograph by Jonathan Kent)

Starting this week, a new monthly series on insurance, the need, the products, the historical emergence and evolution of the re/insurance industry in Bermuda.

Demonstrable proof! Bermuda: sun shines on the reinsurance island once again … in an interview in The Insurer, David Burt, the Premier, said an estimated $19 billion of fresh capital backing had poured into “Class of 2020” start-ups and incumbent scale-ups.

Never has it been so obvious!

If our collective selves did not understand it before, the Covid-related economic impact has forced that recognition.

International business is absolutely vital to our Bermuda’s economic health.

The Bermuda re/insurance industry is an incredible, exemplary model to the world. The innovation, the participants, the products, the massively big-picture forward thinking that propelled Bermuda into the premier international finance jurisdiction that it is today, is our island’s amazing story.

It needs to be told again and again!

Interspersed with today’s re/insurance business innovation, Moneywise will weave historically significant events from our past successes as documented by Catherine Duffy, country leader of AIG Bermuda, who has graciously permitted us to quote liberally from her marvellously researched 500 page-plus reference book Held Captive” A History of International Insurance in Bermuda (2004).

Special recognition also to Brian Hall, an amazing industry innovator and the third Fred Reiss Lifetime Achievement Award recipient, for his eloquent foreword to Ms Duffy’s book that reflects his passionate vision and support of documenting Bermuda’s historical success for all posterity. Further, it is far, far better than anything Moneywise could ever write.

A segment of Mr Hall’s foreword reads: “The recounting of the evolution of insurance in Bermuda has been talked about for years. It is more important than ever to write that history now, because many of the people who are principal players are retired, while others have passed on and are no longer with us.

“It is a story well worth telling.

“A small isolated, insurance community, with a local agent for Lloyd's, transformed itself over a comparatively brief span of time to become a thoroughly credible leader in the field of conventional and specialty insurance, with a capacity that can stand along few others in the world, including communities that were established over the course of several centuries.

“An island of only 21 square miles, with a population of only 60,000 people, has developed an infrastructure that attracts the captains of the industries to its shores.

“Those who settled in old Bermuda had to make everything out of next to nothing. In their isolation they became perforce a tiny, tightly knit community of cousins. Each had to look out for the other; lacking so much, they had to make the most of what they had.

“As they had no continent to subdue, the only wide-open spaces were on the sea. Lacking in natural resources, with no minerals to mine, no rolling pastures, no loamy lands to plough, no wealth of empire to ship back home, the (Bermuda) people had to find their resources within themselves.

“Perhaps all that has made them more adept with what did come to hand.

“Our earliest forebears were the offspring of shipwreck.

“Hazard, hardship and deprivation were their daily bread.

“Successor generations learnt how to make shortages into sufficiency and adversities into opportunities.

“Perhaps these conditions shaped some kind of folk memory, that inclined us to be more perceptive of the hazards endured by others and led us to offer them some protection against such calamities as might beset them. To suppose as much is not mere fancy, just as individuals make choices and commitments based upon their own experience, so does a community. society's one may see an opportunity that another will ignore.

“It could well be that all the past history of Bermuda has helped to shape the vision of its modern financial leadership.

“Such were the foundations on which we were to build.

“The tools, the bricks, the mortar, these were to be provided in the form of ideas and efforts contributed by many people, locals and visitors alike, working together in harmony, who devoted themselves to making Bermuda a key component that would be integral to the business strategies of the world’s largest corporations.

“The visions of many business leaders are portrayed and expounded here, to display for all the energy that was to position this tiny community to attract the finest and the best.

“We had our setbacks, but we learnt from them. We had our detractors and we paid attention to them. We demonstrated our integrity and our professional competence.

“We showed our detractors to be mistaken. We worked through markets soft and hard, finding fine honing our capabilities to accommodate both.

“We had our share of scandals and wheeler-dealers, took our halting baby steps into new ventures, suffered the blows of malicious and invasive media coverage.

“But we listened and we learned. We responded quickly when a situation needed containment. We never obfuscated an issue, nor did we seek concealment. We acted openly and honestly. None could impugn our good faith.”

He added that Ms Duffy’s book helps the reader to understand how such a significant industry developed.

“It is a credit to the many leaders and followers who went before us and created an infrastructure that would enable such an evolution to take place.

“It is a credit to the Bermudian power of vision and to Bermuda tenacity in expounding that vision.

“It is a salute to those companies whose faith in our dream and in our capacity for service inspired them to venture ‘offshore’ and establish their presence here, in some cases more than 50 (now 67) years ago.

“This history recounts how the Bermuda insurance industry has advanced across many different uplands.”

Mr Hall added that Bermuda had developed a local insurance industry as early as 1784.

“We became more influential in providing a range of local property and marine coverage in the beginning of the 20th century.”

Did we ever!

Stay tuned on the fourth Saturday of each month for more current re/insurance narratives, along with reflections of historical successes.

Sources

Bermuda: sun shines on the reinsurance island once again, The Insurer

Bermuda’s insurance sector in strong position after pivotal year, Scott Neil, The Royal Gazette, March 8

Step 14 of the Bermuda Islander Primer: Managing Risk, Consequences and Resolution, is now posted

Martha Harris Myron, CPA JSM, a native Bermudian, is the author of The Bermuda Islander Financial Planning Primers, consultant to the Olderhood Group Bermuda, and financial columnist to The Royal Gazette. All proceeds from these articles are donated to the Salvation Army, Bermuda. Contact: martha@pondstraddler.com

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Published March 27, 2021 at 8:00 am (Updated March 29, 2021 at 8:33 am)

Sun shining again on island’s re/insurance industry

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