Dr. Ellen Thrower knows a thing or two about risk. She has a PhD in risk management but she has also seen what risk is first hand as she both lives and works within a couple of blocks of the World Trade Center (WTC).

In the wake of September 11 Dr. Thrower praised the Bermuda insurance market and said: "Some of the smartest minds in the world - in insurance and in financing risk - are in Bermuda."

Dr. Thrower is executive director and formerly the president of the School of Risk Management, Insurance and Actuarial Science (SRM) in New York City. One building separates the school from the WTC complex, and Dr. Thrower lives two blocks to the south in an apartment with a bird's eye view of the debris and havoc left by the terrorist attack.

In the immediate aftermath of the catastrophe SRM students and faculty - including 15 Bermuda students - were evacuated from the campus of what was known, until June, 2001 and its merger with St. John's University, as the College of Insurance.

"We had to evacuate and relocate to Queen's where St. John's has its main campus. And we were not allowed to return to our campus until a few weeks ago," Dr. Thrower told The Royal Gazette last week. "This was just three days in to the fall semester and some students did not return for the rest of the term."

But Dr. Thrower added that all of the Bermuda students stayed on and she praised the students for pulling together as a team during the tragedy.

Dr. Thrower became president of the College in 1988 and made her first trip to Bermuda the following year. She said: "Bermuda is a very special place for me. There are a lot of people and companies who say they are committed to education and preparing students: you see that in everyone's annual report. But what I find especially meaningful and important is that the people we work with in Bermuda do put their money behind the message. It is not just saying the things that sound good. They get involved with their resources and they give their own time.

"I was so impressed, even overwhelmed from my first trip to Bermuda by the commitment of the industry leaders in making sure that a lot of attention was paid to educating and preparing young Bermudians, not only for careers but for leadership in the Bermuda insurance market.

Dr. Thrower said she works closely with Bermuda companies, the Bermuda Insurance Institute, the Bermuda College and she is an advisory trustee of the Bermuda Foundation for Insurance Studies.

Following September 11, Dr. Thrower said: "We believe that our mission is more important than ever. And our role, in inspiring, attracting and preparing talented young people for careers in risk management has never been greater."

Speaking of how things have changed, Dr. Thrower said: "There is little doubt that the horrible events of September 11 raised everybody's level of consciousness about the need for identifying risk and the need to have financial protection against risk. This applies to individuals, companies and the Government."

Dr. Thrower underscored the broad effect of the attacks and the role of insurance: "I was able to return to my home two weeks after the event, but I know individuals had to live in hotels for months. And I lost my car for three months; I had no idea even where it was. But three months later I got a call saying to come and get it. And the insurance covered the cost of cleaning and decontaminating the car, inside and out."

Dr. Thrower said everyone - from individuals to corporations and government now realise the importance of identifying risk and the need to provide financial security against risk. As a case in point of what can happen without proper coverage Dr. Thrower said: "A lot of the small businesses around 'Ground Zero' did not have business interruption insurance. And lots of those small businesses in the neighbourhood are really hurting now. Some of the businesses have now started back but there are not as many customers as there were. And they could have protected against that risk but a lot of them did not think about it."

When asked if it is really possible to measure risk, Dr. Thrower said: "It has always been possible to measure risk reasonably accurately based on the past. But we also have to realise that is just the past, and the future does not always approximate the past."

Dr. Thrower continued: "There are ways - and I think Bermuda companies are doing a particularly superb job in doing this - of putting together models of scenarios that have never happened before, and making assumptions on that basis. Maybe it is an earthquake on the west coast under a nuclear power plant.

"The idea is to ask what are the worst losses that could happen. It is an art and science to try and identify and quantify risk. And there is the judgment factor because our crystal balls are never perfect."

Speaking of the Bermuda market, Dr. Thrower said it is having an effect on insurance globally: "The market may not get as hard as it otherwise would have. And also the period of the hard market will probably be shorter because of Bermuda's influx of new companies and new capital to those and existing companies.

"It is anyone's guess how long the hard market will last, maybe a year, maybe two."

Dr. Thrower, who is on XL's board of directors and is a frequent visitor to the Island, said of the new capital coming to Bermuda: "Both ACE and XL have raised capital as a result of September 11, and the influx of new companies will have a dampening affect on the market's hardening. How much is anyone's guess, but I think the smart companies are also preparing now for a soft market again. They realise this is not going to last a long time, although that could change if something else happens that no one expected."

Dr. Thrower said: "September 11 has created an awareness that no matter how smart people are, no matter how many millions of scenarios they run there will always be question marks as these are only projections. Things we never imagined can happen."

Speaking of her last trip to Bermuda earlier in the month, Dr. Thrower said: "While I was there ACE had an evening for teachers, parents and students to tell them about exciting career opportunities in insurance. And they are exciting. People still have on blinders and think insurance is boring. This is an industry that is far more than insurance including finance and learning how to evaluate risk."

And Dr. Thrower said Bermuda is one of the best places to gain industry experience: "Certainly we think ACE and XL are two of the finest and smartest run insurance companies in the world. And our students know that too. And would be quite happy to work for either.

"And new companies, like AXIS, are starting up in Bermuda, and they have a lot of capital and they understand how to write insurance and how to cover risk.

"The market has pulled back and said we are not going to cover terrorism. But customers are demanding that coverage and smart minds and smart money is going to go to Bermuda to put together facilities to meet that demand," she concluded.