After a shaky period, the Island’s reinsurance sector is optimistic, according to the online publication Global Reinsurance (GR) in an article which ran yesterday about the Bermuda industry.

The industry website article quoted Association of Bermuda Insurers & Reinsurers president Bradley Kading, Economic Development Minister Grant Gibbons, and industry professionals. It said: “In just over a year since it came to power the One Bermuda Alliance (OBA) Government has shown its willingness to work with the Island’s international business community. It has scrapped term limits and strengthened ties with international business.”

The story also quoted just-released statistics which showed the Bermuda Monetary Authority’s new company registrations were up in 2013: “ ... with 91 new formations, a 72 percent increase on the previous year”.

It continued: “In an interview with GR in October, Bermuda Premier Craig Cannonier and Finance Minister Bob Richards stressed how encouraging reinsurance growth was a top priority.”

GR stated that Bermuda has long been a hub for international reinsurance, but that dominance began to look uncertain in recent years. “With high-profile companies and their executives beginning to relocate, plus a slowdown in new company registrations, the One Bermuda Alliance (OBA) party had its work cut out to improve the situation when it took power in 2012.”

Third Point Re chief executive John Berger is quoted, saying: “It’s a trend in a positive direction in terms of new companies being formed,” and adding: “Will there ever be like an ACE and XL again, really big companies with big employment levels? I don’t know, but clearly the trend is going the right way.”

GR said how much of the improvement is down to a general improvement in the economy and re/insurance sector investment and how much is a result of Government initiatives is unclear. “But the two forces are combining to bring renewed confidence to the island nation and its world-class reinsurance centre.”

The article painted a grim picture of the Bermuda economy when the OBA took the reins of power in 2012. “(It) was sluggish with GDP down by 1.4 percent in 2012, and when adjusted for inflation, the growth in economic activity declined 4.9 percent. In March 2013 Standard & Poor’s lowered its outlook on Bermuda from stable to negative citing its ‘prolonged economic downturn and deteriorating fiscal performance’.”

Dr Gibbons is quoted saying: “What we found on coming into Government was a general sense of economic pessimism in Bermuda. 2012 was the fourth year of negative economic growth, which was really unprecedented for Bermuda.

“There was a huge lack of confidence in the economy and obviously we recognised it was important to turn this around. Over the previous five years there had been a loss of over 3,000 non-Bermudian jobs since 2008 — about 1,000 of those were in international business — and in addition about 2,000 Bermudian jobs had been lost in that period as well.”

GR continued: “Compounding the challenging economy were unpopular immigration rules introduced by the previous ruling party. The term limits policy, which had started in 2001, imposed a six-year limit on most work permits in an effort to curb long-term residency.”

Mr Kading was quoted as saying: “Work permit issues were one of those aggravating circumstances that made it more difficult than was necessary to do business.”

GR stated: “One year on and the situation has improved considerably, with term limits a thing of the past. In December the Incentives For Job Makers Act was amended, under which a company can obtain concessions that include having their senior executives exempt from needing a work permit. The new rules recognise the contribution of the C-suite in creating new jobs.”

The article concluded: “ ... and with the OBA government taking steps to remove barriers hindering Bermuda’s attractiveness the atmosphere in Hamilton is decidedly upbeat. ... Overall the OBA appears to be moving in the right direction.”