A big increase in the number of catastrophe bonds and insurance linked securities (ILS) reflected in a proliferation of Special Purpose Insurers (SPI) contributed to the surge in new insurers setting up in Bermuda.That is according to Tim Faries, insurance group team leader at Appleby, said that the latest statistics released by the Bermuda Monetary Authority (BMA) which revealed that 53 licences for new insurance companies were issued last year, including 13 in December, as reported in The Royal Gazette yesterday, were very encouraging for the jurisdiction and capped off a year which saw the overall numbers rise by 50 percent over 2010.“The principal reason for the greater number of licences in 2011, in my view, has been the increased use by clients of the Special Purpose Insurer (SPI) category, as Bermuda has had some success recently in attracting more business to the jurisdiction for catastrophe bonds and other insurance linked securities (ILS) structures,” he said.“You will see that nearly one third of the December licences were for the SPI category, and that SPIs accounted for 23 of the 54 licences issued by the BMA in 2011.“That is a significant development for the SPI category, which was introduced just a few years ago and was designed to make the jurisdiction more competitive with centres such as Cayman and Ireland, who were doing the lion’s share of the ILS deals.“As the results show, we have been successful in winning over some of the market share for these types of deals, which bodes well for the future of this segment of the industry in Bermuda.”Mr Faries added that as the December results showed, the Island continued to see a number of commercial insurer (small Class 3A and large 3B and 4) formations, reflecting that Bermuda was the only offshore re/insurance centre which was on the path towards Solvency II equivalence.Tom McMahon, president of the Bermuda Insurance Management Association (BIMA), said that the numbers were a huge boost for Bermuda.“These are indeed great numbers for Bermuda 54 new incorporations in 2011 is great vote of confidence by the international market in the domicile,” he said.“Of note is the number of SPI incorporations Bermuda recognised the need for appropriate regulatory changes last year in this area and now the numbers speak for themselves.“Bermuda continues to set the pace for regulatory changes changes not for the sake of changing but to enhance what was in existence.“2012 should be a very exciting year for Bermuda.”