FOREWORD

BUILDING A NEW PILLAR

Bermuda’s life industry has become an extensive marketplace, but there could be much more growth potential ahead, says Martin Laframboise, executive director of Bermuda International Long Term Insurers and Reinsurers.

“The Bermuda life industry has become a comprehensive marketplace.”
Martin Laframboise, BILTIR

The life insurance and annuities industries are, by their very nature, concerned with long-term issues and helping to create stability in people’s lives. The industry’s products are designed to help people to plan for their future so that they can enjoy retirement in financial comfort. As well as funding for later years, our products are designed to help policyholders protect their families in the case of premature death, disability or illness.

The mission of the member companies of Bermuda International Long Term Insurers and Reinsurers (BILTIR) is to mitigate the risks of life’s economic uncertainties for policyholders and their families.

BILTIR members represents 68 annuity and life insurance and reinsurance businesses, as well as servicing companies, on the Island who have deep roots not only in the Island’s international business sector, but also in our economy and our communities. BILTIR companies employ more than 600 staff in Bermuda, 60 percent of whom are Bermudian, and contribute around $500 million per year to the local economy.

The Bermuda life industry has become a comprehensive marketplace. The global demand for life insurance continues to grow due to aging populations, increased longevity, and an increasing middle class. As companies seek to meet this demand, the Island’s robust business infrastructure creates an attractive domicile for life carriers seeking to establish and expand their businesses.

Over the years, Bermuda has developed a deep specialised pool of intellectual talent and expertise in all reinsurance related fields, including accounting, audit, actuarial, banking, legal, insurance administration, IT and insurance management.

“Insurers like Bermuda because its regulatory regime and supervisory framework are aligned with some of the highest international standards.”

The four pillars

Given the longevity of our products, the Bermuda life sector is here for the long run. This has led BILTIR to develop a strategy and committee structure that focuses on four key pillars:

  • Local advocacy: maintenance of Bermuda’s commercial appeal through close engagement with regulatory and legislative officials;
  • International advocacy: preservation and advancement of the global reputation of our industry and our jurisdiction;
  • Learning and networking: sponsorship of professional development, innovation, ideas exchange, and networking opportunities for our members; and
  • Social impact: positive impact on Bermuda’s community, economy, and environment.

BILTIR is committed to creating jobs for Bermudians and to developing a strong pipeline of talent into the Bermuda life re/insurance market for years to come. We have a $30,000 annual scholarship scheme, and this year, a record 26 Bermudian students took part in summer intern programmes with BILTIR member companies.

Bermuda has managed to balance having a robust, internationally recognised regulatory framework that is based on prudence and sensible risk management, with an entrepreneurial flair that allows life insurers to find financial solutions that protect people throughout their lives. Bermuda-based carriers can be nimble in bringing new products to markets, contributing to its well-earned reputation as the ‘World’s Risk Capital’.

As well as the depth of creative talent on the island, another major attraction for the life industry is the strong reputation of our regulator, the Bermuda Monetary Authority (BMA). Insurers like Bermuda because its regulatory regime and supervisory framework are aligned with some of the highest international standards.

The BMA maintains a strong and cooperative working relationship with a diverse set of international regulators, and actively participates in numerous supervisory colleges intended to ensure global best practices with respect to the operations and solvency of companies doing business in multiple jurisdictions.

The BMA is actively involved in helping to create industry best practice, actively participating in a large number of International Association of Insurance Supervisors (IAIS) initiatives and committees.

In 2016, Bermuda was deemed by the European Commission to be fully Solvency II Equivalent, meaning that Bermuda is recognised as a supervisor of the same standing as EU-based supervisors.

In 2015, the National Association of Insurance Commissioners (NAIC) in the US granted Bermuda Qualified Jurisdiction Status, and in 2019, the NAIC approved Bermuda as a reciprocal jurisdiction. As a result, Bermuda-registered reinsurers can write cross-border US business with reduced or zero collateral requirements in a number of US states, which puts them on a level playing field with US competitors in terms of the US marketplace.

Bermuda is one of only two jurisdictions in the world that carries both EU Solvency II equivalence and US reciprocal jurisdiction designations. Bermuda is also compliant with the Insurance Core Principles of the IAIS.

Bermuda has a close working relationship with a number of international regulators and the BMA work collectively to communicate with the industry and through BILTIR to ensure the latest requirements make sense for Bermuda’s re/insurers.

Bermuda’s risk-based solvency framework has helped it to develop as one of the most sophisticated commercial insurance marketplaces in the world. Our industry’s reputation for innovation and access to deep talent, are some of the reasons why many insurers and reinsurers choose to do business on the Island.

“Bermuda has a close working relationship with a number of international regulators.”

Global outlook

In July this year, BILTIR announced it was forming a Global Advocacy Committee to work with other business organisations and stakeholders to promote Bermuda’s reputation and to engage in international issues which affect the Island’s life insurance sector.

While the industry is highly respected globally, at times that message is not as well-known as it should be. The role of the Global Advocacy Committee will be to:

  1. Proactively engage on international issues impacting Bermuda and promote the strength and vitality of the Bermuda life insurance sector that prioritises policyholder protection above all else.
  2. Increase engagement with international regulators, governments, legislators, BILTIR members, rating agencies, clients, distributors and advocacy groups to educate stakeholders on Bermuda’s life sector.
  3. Work in partnership with the BMA, Bermuda’s international business associations, and other Bermuda organisations to promote and execute the mission of BILTIR internationally.

In establishing the Global Advocacy Committee, we have been able to draw on a great depth of expertise from our member companies on the Island. Members of the committee will have responsibility for overseeing different geographies such as the US, Asia, the EU/UK and globally.

Bermuda is a great place to do business and people feel very privileged to work on such a beautiful and sophisticated island. Through our new Global Advocacy Committee, we look forward to telling that positive story to a wider audience.

To find out more, visit: biltir.bm

Image courtesy of Shutterstock / Krofoto