Bermuda attracts innovation

“Within this overarching term of specialty lines, appetites will, of course, vary.”

Welcome to our first special report of 2023—a publication with a focus on specialty lines on Bermuda and their importance to carriers, while also offering an update on the market more generally including rounding up some of the most pertinent news items of 2023 so far.

It has certainly been an eventful few months on Bermuda, which continues to showcase its ability to innovate, solve problems and, ultimately, help companies around the world place risks. The incumbent re/insurers continue to enjoy hard market conditions, which is reflected in their results and the fact some are raising more capital, but we have also seen a number of new ventures launch.

Veteran reinsurance executive and serial entrepreneur Andre Perez has launched his second new venture on Bermuda in a matter of months, both focused on technology and operating, initially at least, in the insurance-linked securities space. A number of new carriers registered with the Bermuda Monetary Authority across several classes. And it will be interesting to see more plans unveiled for a new cyber-focused broker, which founder Edouard von Herberstein has said could transform into an managing general agent.

In terms of specialty lines, we offer some insightful interviews in this issue around the way carriers view this space and their strategy for moving into it. Some newer players have based their entire strategy around specialty lines, and will slowly broaden out from that narrow base. But it seems some of the very biggest carriers are also looking to write more of this business in a hard market.

Brokers interviewed in this issue suggest the diversification such business offers can be attractive amid the volatility of a hard market. Certainly, the attraction is clear if rates in many such lines stay at attractive levels. But the approach of some carriers is different again.

AXA XL offers a revealing interview in this issue, in which its Bermuda CEO explains how it is using its more selective approach to writing property-cat business to expand its footprint in this space, thus benefiting from the diversification on offer. Effectively, it wants to work with clients across more lines of business on a much deeper level. Those open to this will also benefit from property-cat coverage. In return, AXA XL gets more specialty lines business.

Such an approach can be a win-win for both parties, and it clearly illustrates the importance of this type of business to large carriers. Within this overarching term of specialty lines, appetites will, of course, vary. Some players are more bullish in some areas than others—eg, cyber remains a love/hate ploy for many players. Yet the activity around it is second to none.

All these themes and much more can be found in this issue. Enjoy this Bermuda:Re+ILS special report.