Bermuda (re)insurers and the California wildfires: A critical role in disaster recovery
Key financial losses and industry impact
According to data collected by the Bermuda Monetary Authority (BMA), Bermuda-based (re)insurers are expected to assume approximately US$10 billion in liabilities arising from these events—representing up to 30 per cent of total industry-insured losses. Industry-wide insured losses are projected to exceed US$30 billion, while total economic losses are estimated between US$250–275 billion. Covered claims include property destruction, business interruption, evacuation and living expenses, debris removal, reconstruction, and regulatory compliance costs.
Bermuda's proven track record in supporting US catastrophes
This is not the first time Bermuda (re)insurers have demonstrated their importance in disaster recovery. Historical data highlights their substantial contributions to past catastrophic events:
- 2017 hurricane season (Harvey, Irma, Maria): Covered 30 per cent of insured losses.
- 2021 events (Hurricane Ida, Texas Winter Storm): Covered 30 per cent and 20 per cent respectively.
- 2022 Hurricane Ian: Covered 25 per cent of insured losses.
- 2024 events (Hurricane Helene, Hurricane Milton): Covered 20 per cent and 15 per cent, respectively.
The BMA emphasises how US insurers ceding risks to Bermuda entities enables global risk diversification and helps stabilise insurance costs for consumers, especially in high-risk regions.
Addressing the protection gap
While Bermuda’s (re)insurers play a vital role in settling claims, the stark contrast between economic and insured losses remains a societal concern. Craig Swan, Chief Executive Officer of the BMA, highlighted the importance of addressing this protection gap through increased collaboration between regulators, insurers, and other stakeholders. Stronger public-private partnerships could bridge this gap, ensuring more comprehensive coverage for affected communities.
Supporting recovery and rebuilding efforts
For communities impacted by the wildfires, the swift response of Bermuda’s (re)insurers is crucial in facilitating recovery. Gerald Gakundi, Deputy Managing Director of the BMA, stressed the importance of timely claim settlements in rebuilding efforts, particularly during periods of extensive loss and hardship.
The BMA conducted its US Data Claims Survey in March 2025, collecting responses from 119 (re)insurers. The survey results confirm Bermuda’s indispensable role in disaster risk management, offering much-needed stability amid uncertainty.
The press release can be found here.
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