Re-Insurance

Bermuda has fintech and insurtech prospects

  • New technology: Justin Willmott, left, Laura Taylor, and Julia Henderson were on the panel that discussed Bermuda and the role it might play in the development of fintech and insurtech (Photograph by Scott Neil)

Bermuda has a role to play in the development of fintech and insurtech, but there are differing view about the extent to which the island is likely be involved.

The question of how insurers and reinsurers can deploy capital in fintech and insurtech opportunities, and why Bermuda is well placed for this to happen, was asked at the GR Innovation & Insurtech conference.

A panel of three discussed the island’s strengths and weakness to be a “test bed” jurisdiction for the new technologies, and while the views were mostly positive, there were a few caveats.

Justin Willmott, vice-president underwriter, of Sovereign Risk Insurance Ltd, noted Bermuda’s multi-decade track record for innovation, and the apparent natural synergies that exist particularly between ILS and technology and digitisation.

“If you see a synergy between the technology — that to me makes sense, and you can have that happening in Bermuda,” he said.

The conference, which was hosted by Global Reinsurance and held at Rosewood Bermuda, Tucker’s Point, had earlier been opened by David Burt. The Premier spoke about the government’s willingness to support technological development and building such industries in Bermuda.

Mr Willmott said: “Clearly the Premier made a very open and ambitious statement about what Bermuda and the government of Bermuda want to do in the future. I hope it can happen.

“The flip side is the world is very competitive — you have got Singapore, London, Tokyo, Silicon Valley, Google and people like that.”

He mentioned Dubai’s education initiative focused on emerging technologies such as distributed ledgers.

“If Bermuda can do something similar, why not,” he said.

Laura Taylor, managing partner and CFO at Nephila Capital, said start-ups would require access to resources and knowledge, and in Bermuda they would find a concentration of knowledge in insurance, reinsurance, and index-linked securities, together with strong and innovative regulation.

“There is an opportunity for Bermuda to play a meaningful role in this next phase. Plus you have a regulatory environment that fosters innovation. If you look at US and elsewhere they are much more constrained,” she said, adding that the challenge for Bermuda is to figure out a role that isn’t being played elsewhere at the moment.

However, the third member of the panel, Julia Henderson, senior vice-president at Brit Insurance, said there were currently hurdles to Bermuda becoming the right place globally to develop fintech and insurtech.

Part of her concern centred on possible repercussions from events beyond the island’s shores, such as Britain leaving the EU, and the proposed bill to overhaul the US tax system. Referring to the latter, she wondered how much that would affect capital and its ability to be deployed in Bermuda.

The high cost of doing business in Bermuda would also weigh on the island’s prospects to attract the innovators if competing jurisdictions were less expensive.

However, Ms Henderson did note Bermuda’s regulatory strengths. She said: “What we can do is continue our world class regulation, the development of which we are actively doing.

“I have worked with regulators in the UK, US, and other jurisdictions, and what we do here is really world class.”

She said the island can also continue to train staff and keep Bermudian staff trained, adding: “We have excellence on the insurance side. These are things we can control. We can’t control what is happening around other domiciles.”

While Mr Willmott said he saw big opportunities to have the data and analytics part of the value chain happening in Bermuda.