SPI registrations contribute to healthy 2012 for Bermuda re/insurance market

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The year 2012 saw brisk activity in the registration of new insurers, reinsurers and captives in Bermuda. New insurer registrations totalled 53 for the year, according to the Bermuda Monetary Authority, with 27 of those being Special Purpose Insurers (SPI), the class of insurer in Bermuda which are largely used for catastrophe bond issuance or as collateralized reinsurance vehicles or sidecars.

Overall the Bermuda insurance market saw aggregate gross premiums written of $107.6 billion for the year, which equates to a net premiums written of $94.6 billion. Overall, the market recorded aggregate capital and surplus of $168.7 billion and insurers and reinsurers held total assets of $452.2 billion.

Shelby Weldon, Director of Licensing and Authorisations at the Authority commented on the Bermuda markets resilience; “Bermuda’s insurers continue to write significant volumes of premiums and hold substantial amounts of both assets and capital and surplus,” he said. “The volume of business being written here and the quality of our firms show that Bermuda remains one of the world’s premier insurance domiciles.”

The commercial insurance and reinsurance sector was responsible for $87.3 billion of the gross premiums written, while the captive sector was responsible for $20.3 billion.

Wheldon commented; “Bermuda remains the largest domicile in terms of active captives – a total of 856 as of the end of 2012. We are continuing to see new captive business choosing to locate here, based on our experience, both in terms of the practical regulatory environment and professional service providers on the ground catering to captives, as well as unparalleled access to a sophisticated reinsurance market.”

Of the 27 Special Purpose Insurer (SPI) registrations during 2012, a good proportion where catastrophe bond issuing entities, with Bermudas cat bond SPI’s accounting for around 40% ($2.5 billion) of the ILS markets cat bond issuance in 2012.

“Having put in place the regulatory framework for SPIs in 2009, we are pleased to see initial interest now translating into active business,” Mr Weldon commented. “The total volume of new ILS issued globally in 2012 was $6.4 billion with $2.5 billion, or 40 percent, of this total being sponsored by Bermuda-registered SPIs. Overall, SPIs provide another alternative risk transfer option which builds upon Bermuda’s longstanding expertise in this area. The jurisdiction is committed to servicing this growing segment of the market.”

The full list of the 27 SPI’s registered in Bermuda in 2012 can be found below. Where we have details on the use of the SPI, generally as a cat bond issuer or as a sidecar, we’ve linked the SPI’s name to more details.

Special Purpose Insurer (SPI)Date of registration
Blue Water Re Ltd.17-Jan-12
PartnerRe Catastrophe Fund Ltd.23-Jan-12
Queen Street V Re Limited3-Feb-12
Arden Indemnity Ltd.28-Mar-12
Everglades Re Ltd.2-Apr-12
AlphaCat Re 2012, Ltd.15-May-12
Pendulum Re II Ltd23-May-12
Orange Grove Re Ltd.25-May-12
Timicuan Reinsurance III Limited28-May-12
Pangaea Reinsurance IV Ltd28-May-12
New Point Re V Limited12-June-12
Queen Street VI Re Limited25-June-12
HG Re Ltd.26-June-12
Third Point Re Cat Ltd.25-July-12
Eurus III, Ltd.27-Aug-12
Queen Street VII Re Limited16-Oct-12
Lakeside Re III Ltd.3-Dec-12
Saltire Re I Limited3-Dec-12
Collateralised Re (U) Ltd.10-Dec-12
Collateralised Re (A) Ltd.10-Dec-12
Collateralised Re (G) Ltd.10-Dec-12
Collateralised Re (S) Ltd.10-Dec-12
Deep Blue Re Ltd.14-Dec-12
Upsilon Reinsurance II Ltd.19-Dec-12
Intersurer SPI Limited21-Dec-12
Harambee Re 2013-1 Ltd.24-Dec-12
Branco Re Ltd.27-Dec-12
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