A booming market in insurance linked securities in South Korea could bring extra business to Bermuda, an expert said yesterday.

Jason Carne, a managing director at global accountancy firm KPMG, said: “Breaking into new markets such as Korea, which can bring new types of risk, can help.

“Bermuda is trying to extend its lead as a dominant jurisdiction in insurance linked securities.”

Mr Carne was speaking as the firm hosted a special seminar on insurance linked securities (ILS) for clients and contacts, featuring two US-based speakers.

Brent Poliquin, of AIR Worldwide, which provides hi-tech catastrophe modelling tools, services and software to financial institutions and other organisations, and Joe Louwagie, of disaster analysts Property Claim Services, spoke at a KPMG seminar in the company’s Hamilton HQ.

Mr Carne said the two were here for an ILS event to be held on Tuesday and Wednesday — so KPMG decided to take advantage of their expertise while on the Island.

He added: “I have seen some of the models and what they do is incredible.

“We thought it was important to bring them in here and educate the market on ILS transactions — the more education there is, the more confidence people will have in Bermuda and we want to widen the field of expertise in Bermuda.

“It’s good to have some our clients and contacts get exposure to these guys.”

Mr Carne said that, while ILS posed a threat to traditional reinsurance models, it also offered opportunities for new business.

He added: “It’s a very interesting environment. My view is that, with ILS, the market drives where reinsurance is going to go.

“If the market is saying they want collateralised products, that’s the way the market is going to go. We have to be responsive to way the market is going.

“We can either stand on the sidelines and watch the market go elsewhere or take advantage of it.

“ILS is bringing jobs and international capital to the island and that’s helping the economy. It’s providing a threat and an opportunity and different people are responding in different ways.”

Mr Carne added that there was “a lot of investor money” looking to get into the ILS market. Breaking into new markets would just mean more of that invested money would come, which means more markets, more deals and more jobs.”

Mr Poliquin said that there was $179m worth of catastrophe bonds in 1996 — but the year to date had logged more than $6 billion in issuance.

He added: Catastrophe bonds have become an integral strategic risk transfer tool in recent years.”

And Mr Louwagie predicted that the catastrophe bonds would hit their highest-ever issue level by the end of this year.

Mr Louwagie, who has already visited Korea, said interest in the area among the insurance industry was so high in South Korea that it was possible a conference on the subject could be organised for next year.

He added: “We have received very positive feedback from some of the primary carriers to the point they have said they help us get in touch with other carriers.”