The future is bright for Bermuda's reinsurance industry despite a softening market.

That is the view of Mark de Saram, chief executive officer of Everest Re (Bermuda) Ltd., who was talking as part of a panel comprising Susan Patschak, CEO of Canopius Bermuda Ltd., and Greg Richardson, chief underwriting officer of Harbor Point Re Ltd., at the 22nd International Reinsurance Congress held at the Fairmont Hamilton Princess hotel on Wednesday.

Among the topics debated were Bermuda's reinsurance sector maintaining its underwriting discipline in a soft market, capital management and how it relates to underwriting, the 'restraining influence' of regulators and ratings agencies and the relationship between management and underwriters.

Mr. de Saram kicked-off proceedings with a speech about the current state of the reinsurance market and how it had changed since September and during the fall-out from the current financial crisis.

"Going back to September, the view was we were in a soft market and we should buckle down for some years," he said.

"Frankly I do not think I accepted that, but it was fair to say that the insurance market was pretty soft back then."

He looked at trends in the reinsurance industry over the past 30 plus years, including US property and casualty profitability, which featured about 10 years between the peaks and troughs, with a quick rise from trough to to peak and an extended fall from peak to trough.

Mr. de Saram said that at the beginning of 2008 a number of companies were experiencing a healthy return, but he reckons overall they will see a reduction in that figure by the end of this year.

"We have had a pretty good recent run, but we seem to be coming off that now," he said.

As far as pricing of commercial lines was concerned, he said reinsurers were back to the same rates as the second quarter of 2001, while he viewed the insurance sector as well capitalised prior to today's economic turmoil compared to its reinsurance counterpart. "That is the difference between a soft insurance market and a pretty well disciplined reinsurance market," he said.

Mr. de Saram said as well-capitalised insurers would seek to renew their coverage, many companies were still deciding on whether to offer finance or production type insurance.

"I think the demand for reinsurance is actually a pretty rosy picture," he said.

"I am actually very encouraged by the opportunity for the reinsurance business - I think for those that are strong and have got capital and the ability to continue to offer the level of security required, there is going to be an upsurge in demand.

"I do not think we are going to be in for the predicted downturn that was envisaged - the upturn is going to be sooner than anticipated."

Ms Patschak said the future of reinsurance was in the present with a lot of activity and opportunities happening at the moment in light of global financial crisis.

She gave an overview of her recently Bermuda-incorporated company and how it operates with respect to the reinsurance market.

And she reckons the impact of American International Group's $85 billion bailout by the US government and the struggles facing XL could work to other reinsurers' advantage with clients being more wary of having too much exposure to one company.

"I think when I look back to the current credit crisis there was a lot of correlation going on that was not good," she said.

"I think we really have to go back to basics and say 'What does this mean?' and feel comfortable with the risks that we are putting in our books."

Mr. Richardson then wrapped up with a synopsis of the overall market with his take on the effects of current events on the industry.