MR. COFFEY'S ASSESSMENT OF THE GLOBAL GROWTH OF REINSURANCE

Implications: I completely agree with Mr. Coffey's assessment of the strengthening global reinsurance market with the melding of traditional London Market syndicates with Bermuda reinsurers. This makes capacity increase and at the same time contributes to the financial strength necessary for confidence in today's global reinsurance market. As was first evident in the mid-1990's, increasing reliance on Bermuda market insurers/reinsurers by risk managers to complete their global insurance needs resulted in London and other European reinsurers moving toward the establishment of Bermuda based affiliates. Once the relative ease of operation in Bermuda became apparent to those reinsurers, merged operations that became based in Bermuda became increasingly common. Today that capacity has steadily increased to the point that it has become an essential equation for large capacity required insurance programs. 

Analysis: As Bermuda is the overwhelming domicle of choice for so many fortune 2000 company captive insurers, a vibrant local reinsurance market fills a natural role in adding huge reinsurance capacity behind captive insurers global programs. This synergy of location works toward simplifying a risk manager's job of effective insurance placements with financially strong insurers/reinsurers.