A united front: Bermuda’s captains of industry show how to adapt and survive

All jurisdictions have struggled with the challenge of COVID19, notes Huff, but Bermuda has fared better than most.

“In a small island it is easier to get people to buy in to the measures required to keep the spread under control,” he explains.

“People have been wearing masks, they have not been complaining. While the US has been deeply divided, politically, the same is not true in Bermuda. The response has been led by the science.”

“When it comes to comparing Bermuda with the likes of London and New York, clearly the scale of the challenge is different,” adds Roland Andy Burrows, chief executive of the Bermuda Business Development Agency (BDA).

“However, it is only by working together we can overcome such difficult times.” Burrows points to the close relationship between the government, the regulator and industry leaders in Bermuda, which allowed a coordinated response.

“The BMA and the Bermuda Registrar of Companies continue to be accessible and have issued practical industry guidance to ensure business continues and the high standards Bermuda is known for remain in place,” he says.

Huff agrees, singling out Bermuda’s chief medical officer Cheryl Peek-Ball who, he says, has done an incredible job.

“The government as a whole has not been afraid to change things when they are not working,” he adds.

Having said that, Klein believes the pandemic has highlighted a few issues that Bermuda will need to look at going forward.

“Specifically, it has emphasised the need for healthcare reform on the Island,” he says.

More generally, Klein is concerned that the pandemic has amplified the chasm between the financial services industries and local businesses such as local shops and businesses in the hospitality sector.

While re/insurance companies continued to work during the pandemic, and in some cases fared even better due to lack of travel and other reduced expenses, local businesses suffered greatly, he notes.

“This puts a major strain on the relationship between international business and local business, adding to the mental strain of both.”

Huff is confident that Bermuda will rebound, with the other big sector of the economy, tourism, well placed for a revival.

“I think tourism in Bermuda will pick up again quite quickly,” he says. “It is 90 minutes away from JFK Airport, it is safe in terms of having no crime, it is clean.

“When people on the US east coast want to take a break, Bermuda will be a very appealing option. Organised group travel will increase a bit more slowly but 2021 will be promising.”

The experience of living through the pandemic will have taken its toll on many individual workers, in the re/insurance sector and more broadly. How the crisis has affected the mental health of people working at home, in isolation, will become clear only in the coming months or even years.

Faries says: “It has clearly been a struggle for some people, especially parents with young children, with the schools being closed. I do some work with a non-profit organisation called WeSpeak who have been helping people—especially women—who have been forced to juggle home-schooling with their careers.”

Employees will have experienced this in different ways, she says.

“Inevitably, some managers have been better than others at supporting employees and adapting,” says Faries.

“Some have done really well and have asked the right questions and offered support, others have struggled to adapt, which has put tremendous stress on working parents.”

Working practices have adapted to take these challenges into account.

“People have become more tolerant,” says Huff. “If you are on a Zoom call and someone’s dog starts barking, or a child walks into the view of the camera, it is no big deal.”

“In Bermuda, as challenging as it has been, there is an undeniable sense of community and togetherness,” says Burrows.

“Stunning natural beauty—something that is all around us on this Island—does nourish the soul and the simple things in life have been appreciated much more by everyone.”

There have been some silver linings to the new circumstances workers have found themselves in. Re/insurance is a very international business, and many executives do a lot of travelling, but the lockdown gave people more time at home with their families.

“I bet you will see an increase in birth rates in about eight months!” says Klein. “These new births will assist with social insurance issues worldwide.”

On the other hand, the pandemic has made Bermuda feel like a very different place, notes Faries.

“Before COVID-19 Bermuda used to have that small town feeling, where you run into people you know in coffee shops and end up talking about business,” she says.

“That was always part of the charm of living and working here—it’s not a hierarchical place, it’s a place where junior people have access to senior executives fairly often. With COVID-19 we have certainly lost some of that charm and ease.”

The Island feels quite isolated, she adds.

“Usually you hear the planes going overhead, but with no air travel you really get a sense of being a small island in the middle of a large ocean, a long way from anywhere. Having said that, we weathered the worst of it amazingly well.”

Others have been so busy they have barely noticed the change.

“I have been in the office the whole time because the BSX was classified as an essential service, as global exchanges have been,” says Wojciechowski.

“It is vital to the efficiency of the global capital markets that exchanges and clearing houses continue to operate in times of crisis so that industry participants have access to trading, settlement and clearing—in essence, access to liquidity.

“But it does mean that my perspective is perhaps a little different from that of others who have been working from home.”

As Bermuda reopens, and the Shelter in Place order is lifted, companies face a challenge in bringing employees back to the workplace. Some people will be enthusiastic about returning to the more sociable environment of an office, but others will harbour residual concerns about possible contagion.

“I get the sense that people are quite reticent,” says Faries. “It is a very tricky balance—the economy is fragile so everyone wants to see things opening up, but at the same time Bermuda has worked very hard to contain the virus, and been very successful, so we do not want to see those efforts wasted.

“It was great to see how well the community came together to meet this challenge.”

This difficulty striking the right balance is exemplified by the challenges around kick-starting business travel. Air travel is now available again for Bermudians: passengers are required to take four tests, some before arrival and some after, to ensure nobody brings more cases to the Island.

People who do not want to do that have the option of coming and going into quarantine, offering some flexibility.

While this will allow some travel to resume, it is far from a return to the status quo. Klein notes that, to get to Bermuda from Switzerland, he would have to travel to the UK and switch airports, then go through Canada and stay one night in Toronto, or travel through the US and switch states.

“Currently, it is not worth the effort,” he says.

The expectation is that many people will still avoid all but essential travel. Bermuda hosts several conferences in the second half of the year, such as Convergence, Bermuda’s annual gathering of the ILS industry. This, like others, will go ahead as a virtual event this year.

“COVID-19 has given us an opportunity to invite more people to our Convergence event,” says Faries. “People who have never made it, who would struggle to justify a trip to Bermuda, will be able to take part, which is exciting.”

She admits something will be lost by not holding the physical event.

“A huge part of the appeal is the networking, meeting people and doing deals, and a virtual event can never do that in quite the same way,” says Faries.

“But there are platforms that are better at facilitating live networking, and we think we have found the right one for Convergence. Going forward, we can use this experience to enhance our physical event.”

What happens next in Bermuda will depend in large part on the future path of the virus.

Islanders will be desperate to avoid a second wave of the pandemic on their shores, having been very successful in managing the domestic spread.

As an international business sector, however, the fortunes of the re/insurance industry will also depend on the success of larger centres, such as New York and London, containing their own outbreaks.

“If things can get back to normal quickly, the situation will improve quickly,” says Klein.

“However, the longer it takes to reach a new normal, the longer it will take to recover.”

Faries believes the picture will be clearer in a few months’ time.

“June and July is renewal time but after that Bermuda is always relatively quiet anyway, as a lot of people are on vacation,” she says.

“Things pick up again in September, so it will be interesting to see where we are by then.”

Burrows argues that the pandemic has been a catalyst for technology solutions and digital transformations.

“Traditionally, innovation has been one of the biggest challenges for the re/insurance industry at large, so it will be interesting to see how this influences the conversations being had around insurtech initiatives,” he notes.

He points to the BMA’s regulatory sandbox, and the innovations being developed within it, which perhaps offer glimpses of how the re/insurance industry might evolve in the future.

“Bermuda is entering a very interesting period,” says Wojciechowski. “Companies will review how businesses have operated during the pandemic and before, and will think carefully about whether the ‘old way’ is a model to go back to, or whether there should be a change.”

Dramatic change won’t happen overnight, he adds, but rather it will be an evolutionary process.

“The pandemic gives all industries an opportunity to consider a more humanistic approach to supporting their businesses,” says Wojciechowski.

“Perhaps workforce flexibility will emerge and the stigma of working from home will be replaced by an acceptance that some employees thrive and are more productive in a working-from-home scenario.

“Personally, I think there is value in operating within an office environment, face-to-face meetings for business development and more effective knowledge transfer. Also, working from home does impact the spontaneity you get from people collaborating in a shared working space.”

Whatever happens next, Bermuda will be better placed than most communities to adapt, and the re/insurance industry will stand behind its clients—no matter what.

“Historically, after market dislocations innovation and new capital have come together in Bermuda to help address newly understood risks, and the challenge of COVID-19 will be no different,” says Burrows.

“Matching risk to capital, with quality supporting services, is what Bermuda does best.”

“There is no community anywhere in the world that is more resilient than Bermuda,” concludes Huff.