"An increased level of incorporations and the continued expansion of existing insurers combined to make 1995 one of the best on record for the Bermuda insurance market.
Financial figures recently released by the Registrar of Companies indicate that the market grew sharply in1995, reaching record highs in all statistical categories traditionally used to measure the size of the Island's international insurance industry.
Gross premiums written rose 24% to $23.4 billion while net premiums, which represent the volume of insurance business actually retained by the market, grew to $18.4 billion compared to $14.9 billion in 1994 - an increase of 23%.
The Bermuda market's capital and surplus position, a closely watched number regarded by many as the best statistical guide to the financial strength of the industry, advanced 24% to finish at $36.9 billion against $29.8 billion previously. Total assets registered the largest percentage growth, finishing the year 25% up at $95 billion.
Registrar Kymn Astwood said the statistics, which are compiled from Statutory Financial Returns filed annually by every insurer, characterise a year that saw 90 new insurance companies added to the Bermuda Register. "that was one of our highest figures for annual incorporation activity and it undoubtedly had an impact on the market's financial statistics for 1995," he said.
Mr. Astwood also pointed to what he said was the continued expansion and diversification strategy of some of Bermuda's large commercial insurance corporations as being "a significant contributing factor to the industry's growth last year.
New statistical analyses demonstrate for the first time the size of Bermuda's thriving captive insurance business. The captive insurance presence, generally accepted as having pioneered the Bermuda insurance market over 30 years ago, is by far the industry's oldest sector comprising 867 entities licensed as either Class 1 or Class 2 insurance companies, along with many more captives holding Class 3 licenses.
The new statistics, which have been compiled under provisions contained in the recently enacted Insurance Amendment Act, show Class 1 and 2 insurers as reporting combined gross premiums of $8 billion, net premiums of $5.7 billion, capital and surplus of $15.7 billion and total assets of $38.2 billion.
Mr. Astwood has stated: "Thanks to the provisions of the Insurance Amendment Act, which introduced a multi-licensed system of regulation and allowed us to break out different tpes of company for the first time, we now have a baseline measurement of the size of the captive insurance component of our industry".
"On a going forward basis, these statistics will provide as invaluable tool to gauge the annual performance and health of one of the most significant sectors of our international business economy".
1. ANALYSES OF INTERNATIONAL INSURERS REGISTERED AS AT 1ST JANUARY, 1996
Class Of Insurer Insurers Registered % Of Total Class 1 453 32% Class 2 406 29% Class 3 254 18% Class 4 15 1% Long-Term 42 4% Composites 32 2% All Others 199 14%Explanatory Notes:
A)Class 1 - Single-parent captive insuring only the risks of its owner or affiliates of the owner.
B)Class 2 -
a)a multi-owner captive insuring the risks of its owners or affiliates of the owners;
b)a single parent and multi-owner captive:
i)insuring the risks related to or arising out of the business or
operations of the owners and affiliates, and/or;
ii)deriving up to 20% of its net premiums from unrelated risks.
C)Class 3 - Insurers and reinsurers not included in Class1,2 or 4, such as:
i)Reinsurers writing third party business;
ii)Insurers writing direct direct policies with third party
individuals;
iii)Single parent, group, association, agency or joint venture
captives where more than 20% of their net premiums written arise
from risks which are unrelated to the business of the owners;
iv)Finite reinsurers.
D)Class 4 - Highly capitilized insurers and reinsurers underwriting direct excess liability and/or property catastrophe reinsurance risk.
E)Long-Term Insurers - Insurers writing long-term (or life) business.
F)Composites - Insurers writing a combination of long-term (or life) business and Class 1, 2, 3, or 4 business.
2. ANALYSIS OF 1995 STATUTORY FINANCIAL RETURNS FOR ALL INTERNATIONAL INSURERS
Set out below is a summary of the general and long-term (or life) business written by Bermuda insurers as reflected in the 1995 Statutory Financial Returns filed with the Registrar of Companies. These figures, which are expressed in U.S. dollars, include a comparison with 1994.
1995 1994 %
US$ Billions US$ Billions Change
Gross Premiums Written 23.4 18.8 24%
Net Premiums Written 18.4 14.9 23%
Total Assets 94.0 29.8 25%
Capital & Surplus 36.9 29.8 24%
Explanatory Notes:These figures incorporate the results of the Analsis of Statutory Financial Returns for Class 3 and 4 insurers writing general and long-term (or life) business as detailed in a press release dated 17th September, 1996.
3. ANALYSIS OF CLASS 1 AND 2 INSURERS REGISTERED AS AT 1ST JANUARY, 1996
Class Of Insurer Insurers Registered % Of Total Class 1 453 32% Class 1 with Long-Term licence 2 0.1% Class 2 406 29% Class 2 with Long-Term licence 6 0.4% Sub-Total 867 62% All Others 534 38% Total International Insurers 1,401 100%4. ANALYSIS OF 1995 STATUTORY FINANCIAL RETURNS FOR CLASS 1 INSURERS
Set out below is a summary of the general and long-term (or life) business written by Bermuda's Class 1 and 2 insurers, as reflected in the 1995 Statutory Financial Returns filed with the Registrar of Companies. These figures are expressed in U.S. dollars.
1995 1994
Class 1 and 2 All Classes Of
Insurers Insurers
US$ Billions US$ Billions
Gross Premiums Written 8.0 18.8
Net Premiums Written 5.7 14.9
Total Assets 38.2 76.1
Capital & Surplus 15.7 29.8
Explanatory Notes:1. The Statutory filing deadline for Class 1 and 2 insurers is 6 months after the end of the company's financial year end. Applications can be made to the Registrar of Companies for an extension to the filing deadline of up to 3 months.
2. There is no 1994 comparative figure as the first filing year for Class 1 and 2 insurers was the 1995 financial year.
5. ANALYSIS OF 1995 STATUTORY FINANCIAL RETURNS FOR CLASS 1 INSURERS
Set out is a summary of the general and long-term (or life) business written by Bermuda's Class 1 insurers, as reflected in the 1995 Statutory Financial Returns filed with the Registrar of Companies. These figures are expressed in U.S. dollars.
1995 US$ Billions
Gross Premiums Written 2.2
Net Premiums Written 1.5
Total Assets 10.4
Capital & Surplus 4.7
Explanatory Notes:1. The Statutory filing deadline for Class 1 insurers is 6 months after the end of the company's financial year end. Applications can be made to the Registrar of Companies for an extension to the filing deadline of up to 3 months.
2. There is no 1994 comparative figure as the first filing year for Class 1 insurers was the 1995 financial year.
6. ANALYSIS OF 1995 STATUTORY FINANCIAL RETURNS FOR CLASS 2 INSURERS
Set out is a summary of the general and long-term (or life) business written by Bermuda's Class 2 insurers, as reflected in the 1995 Statutory Financial Returns filed with the Registrar of Companies. These figures are expressed in U.S. dollars.
1995 US$ Billions
Gross Premiums Written 5.8
Net Premiums Written 4.2
Total Assets 27.8
Capital & Surplus 11.0
Explanatory Notes:1. The Statutory filing deadline for Class 2 insurers is 6 months after the end of the company's financial year end. Applications can be made to the Registrar of Companies for an extension to the filing deadline of up to 3 months.
2. There is no 1994 comparative figure as the first filing year for Class 2 insurers was the 1995 financial year.
7. ANALYSIS OF 1995 STATUTORY FINANCIAL RETURNS FOR LONG-TERM INSURERS
Set out is a summary of the business written by Bermuda's Long-Term insurers, as reflected in the 1995 Statutory Financial Returns filed with the Registrar of Companies. These figures are expressed in U.S. dollars.
1995 US$ Billions
Net Premiums Written 0.75
Total Assets 3.55
Capital & Surplus 0.68
Explanatory Notes:The Statutory filing deadline for Long-Term insurers is 4 months after the end of the company's financial year end. Applications can be made to the Registrar of Companies for an extension to the filing deadline of up to 3 months.
The insurance team of Appleby, Spurling & Kempe has been actively contributing to the growth of Bermuda's dynamic international insurance industry by our involvement in formulating and recommending changes to relevant legislation and advising on innovative corporate structures. Our Insurance Team is the largest practice area within the firm and comprises ten corporate attorneys practising almost exclusively in the insurance fields and twelve full-time dedicated corporate administrators. Should you wish to find out more about CATEX Bermuda, please contact Warren Cabral, Head of the Insurance Team, using the telephone or facsimile number or e-mail address printed on the first page.
The Insurance Team Attorneys of Appleby, Spurling & Kempe are:
Warren Cabral (Head) F. Chesley White (Deputy) John D. Campbell Q.C. (Senior Partner) Richard D. Spurling Kenneth E.T. Robinson Douglas H. Molyneux Michael J. Burns Timothy C. Faries Gigi Barit Brian J. PattersonThe insurance Team Corporate Administrators of Appleby, Spurling & Kempe and their secretaries are:
Insurance Team I Cheryl S. Harney (Corporate Group Manager) Peggy A. Tucker (Deputy) Nicola J. Backeberg Michelle F. Smith Jill D. Paynter Kevamae Sampson - Team Secretary Tonita S. Eversley - Team Secretary Marcia Gillbert - Team Secretary Insurance Team II Audrey M. Mansell (Corporate Group Manager) Judy Taylor (Deputy) Cilma A. Lamb Shari L. Simons Stacy Grant Dionne G. Hackett - Team Secretary Marcia Gilbert - Team SecretaryThe content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
