OLDWICK, N.J.--(BUSINESS WIRE)--In this A.M.BestTV episode, Scott Mangan, senior financial analyst, A.M. Best, discusses a recent briefing that reviews market conditions for Bermuda-based insurers and reinsurers, including expansions into new coverages and sources of capital. Click on http://www.ambest.com/v.asp?v=bermuda417 to view the entire program.
In 2016, property/casualty premiums in the Bermuda market were at their highest rate for the past five years on a net basis; however, insurers continue to face negative trends.
“Some players are growing a little bit quicker than others,” said Mangan. “However, a lot of that is attributable to prior merger and acquisition activity, which is now flowing through on an accounting basis for 2016. Most participants have only seen modest or flat growth.”
Mangan also said he sees that reserve development has declined due to the challenging pricing environment and a drop in the average return-on-equity (ROE) due to lack of investment yield. “ROE was 7% in 2016, compared with 12.3% in 2013. That is quite a dramatic drop,” said Mangan.
Mangan believes the Bermuda market will not be turning in the near term, unless something happens in the market that produces more favorable pricing.
To read the Best’s Briefing, titled, “Bermuda Market (Re)Insurers Continue To Fight the Strong Undercurrent of a Challenging Market,” go to http://www3.ambest.com/bestweek/purchase.asp?record_code=260129.
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