New Bermuda market, industry reputation and reserves key issues in 2007

A new Bermuda market, reputation challenges to the industry and reserve deficiencies are among 10 major changes that Mike Wills, president of Catlins Canadian operations, said hes witnessed in the insurance industry.
Wills was speaking at the Ontario Risk and Insurance Management Societys (ORIMS) Professional Development Day.
Rounding out the rest of his observed changes were: the emergence of the risk management profession; natural disasters; instability of the market; globalization; societal changes in general; distribution; and diversification.
Wills noted the emergence of the Bermuda market, including alternative capital models such as sidecars and cat bonds, has caused the London-based market to revitalize itself. Its a hot market with various new products that has forced the London market to become much more competitive, he said. Not just in terms of pricing and coverage, but in process as well.
The industrys reputation also needs some revitalization, according to Wills. He says every time the industry makes a profit, it receives bad press.
We need to talk up the good stuff weve done as an industry in order to better connect with our customers, he said.
He added that increasing transparency in the industry and ensuring contract certainty would be good starting points to creating trust.
And where reserve deficiencies are concerned, he said, historically this has cost more than cat losses; with risk becoming more unpredictable, this could be our next big cat loss.
Better claims management and forecasting will be key to mitigating this challenge.
Wills concluded that while the industry has changed, its still an exciting environment to be working in. If were afraid of challenge, well fail, he said. The key is to understand and meet the challenges, and then to embrace them.