As the government prepares a new tax authority to collect what could be some $750 million annually from the new corporate income tax starting next year, a new survey highlights how one group of international insurers and reinsurers already deliver more than a billion dollars in economic contribution to the island.

Member companies of the Association of Bermuda Insurers and Reinsurers alone contributed a record $1,016,904,197 to Bermuda’s economy in 2023, the highest amount recorded in Abir’s 31-year history.

The record-breaking number comes from Abir’s 19th annual Economic Substance Survey, which saw unprecedented participation of 30 member companies responding.

It represents a part of the Bermuda economy that hosts more than 1200 international insurers in total, a part of the 18,000 international companies, 400 of which have a physical presence here, employing some 4,642 people (National Economic Report of Bermuda).

Since 2006, Abir members have led the local economy with an aggregate economic contribution amounting to $15.35 billion.

The survey details the on-island spending of the participating Abir [insurers and reinsurers] in areas including employment, business services, travel, construction/real estate and charitable donations, and 2023 was the first year the total has exceeded $1 billion.

Record high spending on goods and services from local businesses benefited taxi drivers, restaurants, caterers, hotels, legal and accountancy firms, IT service providers, telecommunications firms, recruitment agencies, consultants, realtors, commercial property owners and construction firms, among others.

The leading international [insurers and reinsurers] surveyed employed 2,140 full-time employees in Bermuda, including 474 underwriting staff.

This included 1,441 Bermudians, spouses of Bermudians, or permanent resident certificate holders.

This was the largest number of Bermudian employees recorded in the survey for 10 years, at a time when employment statistics show more Bermudians are working and thriving in the island’s international business sector than ever before.

In recent years, the workforce of Abir members has consistently maintained a Bermudian representation of approximately 70 per cent.

As a group, Abir members constitute the largest private-sector employer on the island. Through the payroll tax, fees and duties they pay, they contribute significantly to the Bermuda Government revenues that sustain public services.

Abir members are also projected to be the largest payers of the Corporate Income Tax, a 15 per cent tax on the net income of multinational companies with revenues of more than 750 million euros, which will take effect in 2025.

“Abir members are proud of the substantial and sustained contribution made to the Bermuda economy over more than 30 years,” said Pina Albo, Hamilton CEO and Abir chair.

“Over the past 17 years alone, Abir’s survey has tracked more than $15 billion that has flowed into the Bermuda economy through members companies’ direct on-island spending. The multiplier effect as these dollars circulate through the economy means the full benefit of our industry’s presence to Bermuda is much greater, supporting livelihoods across all sectors.

“The data in Abir’s annual economic substance surveys provides hard evidence of Abir member companies’ longstanding commitment to Bermuda. The Island’s vibrant [insurers and reinsurers] marketplace continues to offer Bermudians opportunities for fulfilling and rewarding careers.”

Abir member companies also attract significant numbers of business travellers, who made up 16 per cent of Bermuda’s air arrivals during the first three quarters of 2024, underpinning year-round demand for critical air services linking the island with cities such as New York and London.

The survey found Abir members allocated more than $1.17 million to scholarships on the island in 2023, in addition to the 108 paid internships they provided last summer, a record high number that underlines Abir’s commitment to building a strong pipeline for local talent.

Abir also enables free access to foundational education to Bermuda residents through its sponsorship of the Special Topics in Insurance course, offered in partnership with Bermuda College and the Maurice R Greenberg School of Risk Management, Insurance and Actuarial Science at St John’s University. The 14-week course – aimed at students, career shifters and anyone else with an interest in the industry – will be held for a fifth year in 2025, starting on January 13.

“With many Abir members falling within scope of the Bermuda Corporate Income Tax, we are mindful of how the sea change in the international tax system is rapidly redefining the parameters of competition between jurisdictions”, said John Huff, Abir’s CEO.

“Abir stands ready to work with the Bermuda Government to help ensure that Bermuda’s business ecosystem and cost structure remains attractive to international business, as we enter this new era of heightened global competition.”