Bermuda:Re
Bermuda Re/insurance . November 2008
Editorial
Bermuda Re/insurance is published
by Newton Media Limited.
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Consulting editor: Roger Crombie
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Deputy editor: Samantha Birch
The market has turned. It didn’t take a 9/11 or a Katrina, or
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Sub-editor: Susan Gault
even four hurricanes in a row. All that was needed was the
Editorial advisors:
virtual collapse of the global economic system and a couple
Bradley Kading
David Fox
of relatively small hurricanes making landfall in the US.
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Nicholas Lipinski
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Toronto, Ontario Re/insurance companies are generally the problems, it signifies that Christmas has come
M6K 3E3 Canada
most conservative of organisations when it early. AIG will still write business, but the
Telephone: +1 416 533 7171
comes to their investment portfolios. Fixed- company’s trials have provided opportunities
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Email: info@stranoandpettigrew.com
income instruments form the great majority for its competitors. Business that would have
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of invested capital. Although companies have automatically renewed with AIG is now being
©Newton Media Limited 2008.
lately allowed the percentage of equities in seen by companies that would not previously
All rights reserved.
their portfolios to creep upward, in only a few have been asked to quote. Some of it will
No part of this publication may be reproduced, cases does it exceed what accountants call a be simply to ensure that AIG’s prices are
stored in a retrieval system, or transmitted in any
“material” fraction, i.e. one-tenth. reasonable, but some, doubtless, will be placed
form or by any means, electrical, mechanical,
In the unique conditions of 2008, however, it
outside AIG.
photocopying, recording or otherwise without the
prior written permission of the publisher.
has not been the ‘wilder’ end of the portfolio Every market turn since the mid-1980s has
The views expressed in Bermuda Re/insurance
that has let the side down, but what had once been caused by a different set of circumstances.
are not necessarily those shared by the publisher, been considered the most stable investments. The only constant seems to be: whatever it is
Newton Media Limited. Wishing to reflect the
Now that the biggest are no longer the best in that you’re not expecting is what will happen.
true nature of Bermuda, the editor has included
this year’s topsy-turvy financial markets, such Doesn’t that call into question the merits
articles from a number of sources, and the views
investments prove to have been less prudent
expressed are those of the individual contributors.
of ERM? A source at a Bermuda financial
No responsibility or liability is accepted by
than buying work by Damien Hirst. institution, not a re/insurer, reported that his
Newton Media Limited for any loss to any person, And yet...these conservative investments may company had prepared its inventory of dangers,
legal or physical, as a result of any statement, fact
prove to be the re/insurers’ salvation. Losses in but not weighted them. Thus, the risk of an
or figure contained in Bermuda Re/insurance.
the financial markets have been the key element elevator failure sits alongside the risk of a
This publication is not a substitute for advice on a
specific transaction.
in turning the market around. Doing the right pandemic, and yet the company takes pride in
The publication of advertisements does not
thing turns out to have been right for all the its ERM process.
represent endorsement by the publisher.
wrong reasons. It’s been that kind of year.
What are the odds that the danger that next
Bermuda Re/insurance—ISSN 1749-4508 So what does a hard market mean for presents itself to that company won’t be on
Cover image: ©iStockphoto.com/rami halim Bermuda’s re/insurers? Combined with AIG’s its list?
Bermuda Re/insurance . November 2008 3
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