Bermuda will benefit from ILS growth
The rapid growth of the insurance linked securities (ILS) markets on Bermuda will benefit the island’s economy by driving a new wave of capital spending and hiring on the island – a dynamic similar to what the waves of reinsurance start-ups brought to the island over the years.
Speaking following a Bermuda Reception to showcase what Bermuda offers the ILS markets, David Cash, the chief executive of the Bermuda Business Development Agency (BDA), said the growth of ILS represents a big positive for Bermuda.
“The projected growth of ILS will directly benefit Bermuda as businesses will be required to increase capital spending by hiring people and services in order to meet client needs,” he said. “This in turn affects our economy through increased consumer consumption and spending. Government revenues will also increase thus growing Bermuda’s overall GDP. We’ve seen the economic benefits derived from our insurance, reinsurance and captive businesses; ILS presents a similar opportunity and the BDA is focused on enabling this growth.”
At the end of 2013 the Bermuda Stock Exchange saw a record volume of $9.7 billion insurance-linked listings with the value predicted to grow further in 2014.
Jason Carne, co-chair of ILS Bermuda, also spoke at the event. “ILS is an exciting industry for Bermuda as it aligns perfectly with our responsiveness to an ever-changing business environment and highlights our drive to maintain the island’s position as a leading domicile for financial services and worldwide centre of excellence for ILS and convergence,” he said.
“We have a highly supportive Government that is working closely with our industry to enable innovation and growth. Indeed, there has never been a better time to do business in Bermuda.”
Greg Wojciechowski, CEO of the Bermuda Stock Exchange, also commented. “Bermuda has made a significant and determined effort over the last several years to position itself as a centre of excellence for the creation, support and listing of ILS structures,” he said. “The increased use of Bermuda and the BSX for existing and new launches indicates that critical mass for which Bermuda is known in the reinsurance industry is spanning into its ILS/ART sector. What better way to thank our clients and colleagues for their support and to further showcase Bermuda than by the Bermuda BDA hosting an event to provide for networking and business development.”