Built on Governance, Driven by Innovation: The Bermuda Advantage
Holding 85% of the cat bond market, Bermuda’s edge in alternative capital is no accident.
“Reinsurance is global, but it doesn’t work without Bermuda.” For Brad Adderley, managing partner for Bermuda at law firm Appleby, there’s no ambiguity.
He has watched the island’s growth from the front row since 1996 and is resolute that Bermuda continues to dominate reinsurance with its innovation and sound infrastructure. Leading the way from niche captives in the 1970s to cat bonds and ILS in 2025, Bermuda’s evolution has indeed been relentless, and some would say that today it’s not just keeping up with the market; it’s setting the standard.
Although investors have grown more demanding and regulators are tightening their grip, the island’s sophisticated ecosystem has helped it become a global leader in both volume and depth of infrastructure. “Built on governance, driven by innovation – that’s the Bermuda advantage,” Adderley highlighted.
“It’s a marketplace,” Adderley emphasised. “There are so many brokers and reinsurers on-island; we can do deals with each other. Almost every major player in the world has operations in Bermuda.”
That density of expertise, capital and innovation makes the island unique. “Without Bermuda, the reinsurance market would be in serious trouble. Singapore is not a marketplace. Cayman is not a marketplace. Bermuda is.” he stated.
Nowhere is this more evident than in the cat bond market. Thanks to the growth of special purpose insurers (SPIs), Bermuda has seized dominance. “We’ve probably got 85% of the cat bond market, if not higher,” Adderley observed. “On the ILS side, we’ve got transformers, property and casualty sidecars and cat bonds.”
“Almost every major player in the world has operations in Bermuda.”
Appleby itself plays a central role, as Adderley explained. “We give birth, in that we help raise capital, structure documents, obtain BMA approvals and insurance licence, set up the office, all the way through to preparing companies ready to write business.”
As easy as breathing air
As global regulatory regimes sharpen and mature, Bermuda has remained at the forefront, thanks in part to the Bermuda Monetary Authority (BMA). “We are NAIC-approved, a reciprocal jurisdiction, Solvency II-equivalent,” Adderley noted. “The BMA is constantly making sure we stay at the forefront, and we remain here because of our reputation.”
That reputation is increasingly tied to transparency and ESG (environment, social and governance) alignment. “The BMA has been tackling ESG, compliance and transparency because we want to conform to international standards,” Adderley said. “We don’t want to ruin our reputation, and clients now want to be regulated. Otherwise, policyholders and investors just won’t do business with you.”
At Appleby, these expectations are part of the daily workflow. “Every policy we draft for review by the BMA covers transparency and compliance and ESG. It’s just like breathing air now.”
Yet Adderley is not complacent. He’s troubled by competing jurisdictions that lower the bar. “Some still attract companies with the idea of ‘less is more’: less capital, less governance and less staffing. That really concerns me, because how will that affect other offshore jurisdictions that are doing it correctly?”
But as competitors cut corners, Bermuda is doubling down on governance, capital and innovation, though Adderley noted that the make-up of Bermuda’s client base was shifting, particularly in the ILS space.
“The cat bond market is off the chart, and not just in North America any more. We’re seeing more from Europe and Asia, which can only be good for Bermuda.”
Terms, tech and talent
ILS platform providers are also thriving in Bermuda, enabling smaller and more frequent private cat bonds. “That means more sponsors, more investors and more deals. These platforms are providing more solutions, which means they have new clients.”
Even the types of risks and currencies are evolving. “There are tech companies writing new risks or using bitcoin or stablecoins. There are innovative products using tech to write all risks, old and new. We’re now dealing with tech people doing insurance and insurance people using tech.”
As Adderley looks toward Monte Carlo’s September gathering, several questions are at the top of his mind, predominantly concerning terms, pricing and whether a hurricane would occur before the event.
“Also, will there be another commercial reinsurer, and will they succeed?” he added. “Every year, we read about the same three or four. Out of those, only one, maybe two, ever makes it.”
For Adderley, ILS will always be a topic of discussion. “It’s become much more common,” he observed. In fact, ILS is now so routine for many firms, “a lot of private cat bonds don’t even use lawyers any more”.
But Monte Carlo is also about serendipity. “I was sitting outside the Buddha Bar when I had the very first conversation about doing a private cat bond,” he recalled. “That kind of experience can’t be replicated on Zoom. You never know which crazy idea might grow into something bigger and better.”
In the next one to two years, Bermuda’s largest challenges, Adderley believes, won’t have changed. “It’s always about talent; finding people with the right attitude, who care, and who want to move to Bermuda.” Adderley said. “And with AI, if once you needed 10 people before, maybe now you only need six, so what does that mean for staffing expectations and for the economy?”
Whatever the answer, Adderley is confident Bermuda is ready to adapt. “We’re all going to have to learn from each other,” he said. “But if there’s one place that’s proven it can evolve and lead, it’s Bermuda.”
First Published in Bermuda:Re+ILS, September 2025
Share
Navigating estate administration in Bermuda
When a loved one dies, families are often left to navigate not only grief but also a complex legal and administrative process known as estate administration.
Bermuda: Chambers Insurance & Reinsurance Guide 2026
The guide provides the latest information on sources of insurance and reinsurance law, overseas-based insurers or reinsurers, making an insurance contract, intermediary involvement, alternative risk transfer (ART) transactions, warranties, conditions precedent, insurance disputes and insurtech.
Fund Finance Laws and Regulations 2026 – Bermuda
The Bermuda fund industry sees investment predominantly from North America and Europe, and therefore trends in the Bermuda fund finance market track the major onshore markets. Although there is no overall data reporting service for the local fund finance market, anecdotal reports from many of the major facility lenders, as well as Appleby practitioners, anticipate that there will continue to be a high demand for capital call or subscription line facilities. That is not to say, of course, that other structures such as NAV facilities will not be utilised.
Extracting capital from a Bermuda company
It is widely accepted that one of the main purposes of a business is to create value for its shareholders, who contribute significant capital into entities, hoping that value will be returned to them.
Bermuda Prohibits Bearer Shares and Nominee Directors
On 21 November 2025, Bermuda passed the Companies (Prohibition of Bearer Shares and Nominee Directors) Amendment Act 2025 (Act). The Act, which came into full force on 10 December 2025, amends both the Companies Act 1981 (Companies Act) and Limited Liability Company Act 2016 (Limited Liability Company Act) in respect of bearer shares, nominee directors, alternate directors and beneficial ownership record keeping for companies and limited liability companies (LLCs) discontinuing to another jurisdiction.
Cat Bond Issuance Well-Placed to Reach $20bn Again In ‘26, Fueled by Momentum & Proven Success
Annual catastrophe bond issuance hit record heights for the third consecutive year in 2025, and as Brad Adderley, Managing Partner at law firm Appleby’s Bermuda office highlights, given the significant activity and momentum observed in the market, it would not be unexpected for the market to achieve $20 billion once more in 2026
Collateralised insurers benefit from flexible forms of capital
Bermuda’s well established corporate regulatory regime offers a variety of corporate vehicles that can be used to support insurance-linked securities.
Do cryptocurrencies count as money?
When Satoshi Nakamoto first proposed bitcoin in 2008, he described it as a “peer-to-peer electronic cash system”.
Bermuda: Americas Restructuring Review 2026
This article discusses the defining features of Bermuda’s insolvency landscape and the primary insolvency and rescue procedures available under Bermuda law, including compulsory liquidations, provisional liquidations and schemes of arrangements.
Where there is a will, there is a claim
Imagine living with your partner for more than a decade, only to discover that under Bermuda law, you have no automatic right to their estate if they die without a will.
