A demographic transformation is underway in the United States, with 11,000 individuals reaching age 65 each day. Over the next 25 years, this shift is projected to drive a 40% increase in the population aged 65 and older, a development already shaping the insurance and reinsurance landscape.
At the Bermuda International Long Term Insurers and Reinsurers (BILTIR) Life and Annuity Conference, Mariana Gomez-Vock, senior vice president at the American Council of Life Insurers, addressed the impact of this shift.
“What that's going to result in is a 40 per cent increase over the next 25 years. And the number of folks in the US who are 65 or older, that is really significant.” In a report from the Royal Gazette, Gomez-Vock noted that the surge in retirees is driving demand for retirement products with long-term guarantees, which are “extremely capital intensive to offer.”
Bermuda’s insurance and reinsurance market has seen notable growth in response to these trends. In 2024, member companies of the Association of Bermuda Insurers and Reinsurers (ABIR) reported a 10% year-over-year increase in premium written, bringing gross written premium to over US$188 billion and total equity to US$178 billion.
Gomez-Vock highlighted Bermuda’s role in meeting this demand, citing the jurisdiction’s recognition by the National Association of Insurance Commissioners and the European Union.
“To have jurisdictions like Bermuda that are recognized already by the [National Association of Insurance Commissioners], by the [European Union] as having a robust regime, I think it's going to remain an important piece of the puzzle of where life insurers are going to be able to get access to the capital to help support their ability to provide the products that these new retirees are going to need,” she said.
Gerald Gakundi, deputy managing director of supervision at the Bermuda Monetary Authority, also spoke on the panel. He pointed to Bermuda’s ability to attract capital, though he noted that the sums raised today may not have the same impact as in the past.
“Our market has been able to pull risks from across different lines of business, from across different regions and geographies, both in the retirement and savings, but also on the [property and casualty] side, and have those risks diversified within single balance sheets in Bermuda. That diversification allows for better adjusted risk pricing of the insurance products that are offered by insurance companies that are closer to the customers, the policyholders,” Gakundi said.
Bermuda now represents about 35% of the world’s reinsurance capacity, underscoring its influence in the global market. The island has paid around US$500 billion in property and catastrophe casualty specialty losses in the US alone, supporting recovery after major events.
Offshore activity has also surged, with US life insurance and annuity reserves ceded offshore reaching nearly US$0.8 trillion since 2017. Bermuda accounts for 81% of this reinsurance activity, highlighting its central role in supporting the US market’s capital and risk management needs.
Gakundi stressed that capital and expertise alone are not enough, emphasizing the ongoing importance of risk pooling and diversification.
“I think the future for reinsurance, the future for insurance is there, and there is a need for the products that insurance provides," Gakundi said. "There is also a need for the pooling of the risks, because at the end of the day, that is what insurance is. That is what makes insurance work. Without pooling of risks and diversification we're going to continue to have pockets of risk concentration, and it becomes very, very harsh.”
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