Bermudian Reinsurers Hit By New York Disaster

by Justin Gorringe, Tax-News.com, London

13 September 2001

The consequences of the terrorist attacks in the US this week are likely to include heavy losses for the reinsurance industry, much of which is centred in Bermuda, although there is no reason to suppose that any of the larger companies based there will be fundamentally threatened.

Jean-Phillipe Thierry, the chairman of the annual global conference of insurers and reinsurers being held this week in Monaco, said the global insurance industry had the "will, capacity and experience" to deal with the damage caused by the attacks in the US.

Analysts estimated that the cost of the attacks could exceed $20bn - equivalent to the cost of Hurricane Andrew in 1992, until now the most expensive disaster in the history of insurance.

In Bermuda itself, the offices of most major reinsurers were closed yesterday in sympathy with those suffering from the appalling events in America. Some Bermudian insurance companies, including Aon Group and Marsh & Mclennan.had offices in the World Trade Centre itself.

Marsh & Mclennan in New York employed more than 1,000 employees in offices in both the South and North Manhattan towers. Some of their offices were located in the top five floors of the South tower – the first to be hit.

XL Capital, another of the companies likely to receive major claims as a result of the tragedy, did not have an office in the stricken towers but was devastated by the news. A company spokesman said: "Our thoughts and prayers are with the victims and their families. It is inappropriate and premature at this time to begin any attempt to assess the other losses suffered today."

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