John Huff, President and CEO of the Association of Bermuda Insurers and Reinsurers (ABIR) discusses the health of the Bermuda market, as well as the challenges and opportunities he sees going forward.

According to Mr. Huff, the Bermuda market is “very healthy.” The market is thriving even after the significant natural catastrophes of 2017 and 2018 “nat cats” including Hurricane Michael in Florida and the California Wildfires. He shares the challenge of ensuring that international (re)insurance markets are respected. The insurance industry is global, and there is concern that countries may consider protectionism in trade, tax or regulation rather than stay “open” to competition. In addition to opportunities due to nat cats and climate risk, the Bermuda market is starting to get into specialty businesses, such as cyber insurance.

Another opportunity Mr. Huff sees for the Bermuda market lies in “de-risking government”, shifting exposures from taxpayers to the private sector. He suggests that flood risks in the United States, currently managed as part of the National Flood Insurance Program (NFIP) could be handled in the private market. FEMA and the NFIP have shifted some flood risk to the reinsurance market, but they could go further by engaging the private insurance market. Other government de-risking opportunities include mortgages, earthquake risk and crop insurance. Mr. Huff suggests a larger take-up rate in insurance would close the “protection gap” and alleviate even more of the the burden on taxpayers and governments.

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