Bermuda’s Financial Sector Sees Growth in Assets and Premiums

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Bermuda has experienced significant growth in its financial sector over the past few years, with assets and premiums increasing steadily. According to data released by the Bermuda Monetary Authority (BMA), the island’s banks and deposit companies saw a 21% increase in total assets between 2001 and 2002, reaching $18.7 billion.

Asset Growth

The insurance industry also experienced growth during this period. Gross premiums for Class 3 companies increased by 29%, while those for Class 4 companies rose by 82%. Additionally, the number of long-term insurers operating in Bermuda grew from 11 to 15 between 2001 and 2002.

Alternative Risk Transfer (ART) Arrangements

Alternative risk transfer (ART) arrangements, such as captive insurance companies, have become increasingly popular in Bermuda. These structures allow corporations to manage their risks more effectively and retain more of the premiums paid.

• Captive insurance has several advantages, including lower costs and improved cash flow.
• It is an attractive option for many companies looking to manage their risks more efficiently.

Protected Cell Captives (Rent-a-Captives)

Protected cell captives, also known as rent-a-captives, have become increasingly popular in Bermuda. This structure allows several insureds to share captive facilities. As of 2002, there were 27 cells operating in the country.

Conclusion

The data suggests that Bermuda’s financial sector is experiencing strong growth and diversification, driven by its reputation as a major hub for insurance and reinsurance activity. The island’s banks, deposit companies, insurance industry, and ART arrangements are all contributing to this growth.