Bermuda is perfectly positioned to be a pioneer in mitigating the effects of climate change—and the insurance industry has a pivotal role to play in it.

That is the view of Jim Nadler, chief executive officer of ratings agency KBRA, the major sponsor of the Bermuda Climate Summit in June.

In a video interview with Bermuda:Re+ILS, Nadler said the Island’s position as one of the world’s leading re/insurance hubs and the fact it was at the forefront of the effects of climate change was the “perfect intersection”.

“This conference is a great example of how important climate change is and why it is urgent that we start addressing these risks and include the insurance industry in that conversation,” he says.

“It’s the perfect intersection,” he says of Bermuda. “It’s a small island in the Atlantic, so Bermuda is at the forefront of seeing the effects of climate change. It is one of the very few insurance hubs globally. So it’s a natural fit and where you would see the whole confluence happen.”

“It is urgent that we start addressing these risks and include the insurance industry in that conversation.”

Nadler noted that the Bermuda Monetary Authority has the sandbox, where ideas can be developed within a regulatory environment.

“The regulators look at it and you can have a real sense of ‘does this work or not?’. That provides a unique opportunity for growth in the insurance industry because they work hand in glove with the regulators to make sure we are ahead with healthy regulation, but also moving ahead with cutting-edge ideas, whether it’s science or risk analysis.

“All of those things come together and create the environment in Bermuda that separates it from any other area globally,” he says.

Nadler added that he thinks KBRA’s approach to rating insurance companies gave more priority to the needs of investors and policyholders compared to some other rating agencies’ capital models.