Bermuda:Re
Bermuda Re/insurance . October 2008
Editorial
Bermuda Re/insurance is published
by Newton Media Limited.
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NG33 5NR, United Kingdom
Consulting editor: Roger Crombie
Email: editorial@newtonmedia.co.uk
Deputy editor: Samantha Birch
A Bermuda employee of American International Group told
Email: sbirch@newtonmedia.co.uk
Sub-editor: Susan Gault
a newspaper, at the end of a tough week for the global
Editorial advisors:
financial system, that nothing that had happened would
Bradley Kading
David Fox
affect AIG in Bermuda.
Publishers: John Eddington
Nicholas Lipinski
If only that were true.
Advertising: John Eddington
Telephone: +44 1476 861 737
—Roger Crombie, FCA
Email: john@newtonmedia.co.uk
Consulting editor
Advertising: Nicholas Lipinski
Telephone: +44 020 8290 4943
Email: nlipinski@newtonmedia.co.uk
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Given press deadlines, this is being written in allowing AIG, and with it the financial system
M6K 3E3 Canada
the teeth of the financial gale, but some things that relied on it, to fail. The price the US
Telephone: +1 416 533 7171
are already clear. AIG’s unparallelled reputation Government is charging, three-month Libor
Fax: +1 416 535 7526
Email: info@stranoandpettigrew.com
has taken another hit in a depressing series that plus 850 basis points, i.e. initially 11.38 percent,
www.stranoandpettigrew.com
started when the morally bankrupt former seems usurious, but it says something about the
©Newton Media Limited 2008.
New York Governor, Eliot Spitzer, turned his level of risk involved.
All rights reserved.
attention to the insurance sector.
Of course, every cloud has a silver lining.
No part of this publication may be reproduced,
Size matters, but it does not guarantee The AIG sell-off offers opportunities to other
stored in a retrieval system, or transmitted in any
survival. A trillion dollars of assets can mean re/insurers, will likely shake up market shares
form or by any means, electrical, mechanical,
photocopying, recording or otherwise without the
very little if prudence has not been brought in various lines, and may prompt a wave of
prior written permission of the publisher.
to bear at every step of the way. We do not mergers and acquisitions, which was already
The views expressed in Bermuda Re/insurance
yet know whether AIG started writing, before on the cards before that unprecedented week
are not necessarily those shared by the publisher, Hank Greenberg was forced out, the credit in September.
Newton Media Limited. Wishing to reflect the
default swaps that will bring it down, but it
Despite the size of the institutions that have
true nature of Bermuda, the editor has included
seems unlikely that even he could have saved
failed, the “crisis” is in many ways business
articles from a number of sources, and the views
the giant from the consequences of its actions.
expressed are those of the individual contributors.
as usual. Excessive behaviour on the way up
No responsibility or liability is accepted by Speaking of Greenberg, the phrase "mixed is always followed by excessive behaviour on
Newton Media Limited for any loss to any person,
feelings" has been redefined. It used to be the way down. Markets change with such
legal or physical, as a result of any statement, fact
watching your mother-in-law drive your new consistency that regulation always lags. The
or figure contained in Bermuda Re/insurance.
Jaguar over a cliff. Now, for Greenberg, it's regulatory solutions we adopt to ensure that
This publication is not a substitute for advice on a
specific transaction.
having lesser mortals mathematically prove this never happens again will undoubtedly fail
The publication of advertisements does not
your contention that they are inferior to you in to protect us from whatever awful things occur
represent endorsement by the publisher.
every way, as they wipe out your net worth. next time.
Bermuda Re/insurance—ISSN 1749-4508 The Federal bailout was the right answer— That’s how capitalism works. Thus it was,
Cover image: ©iStockphoto.com/ Baris Simsek and not just because there was no other, shy of thus it is, and thus it always will be.
Bermuda Re/insurance . October 2008 3
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