If Bermuda isn't in the Caribbean, as Dr. Brown repeatedly yelled across the floor of Parliament at the UBP's Cole Simons when he was discussing Bermuda's poor tourism results relative to our Caribbean competitors in Parliament on Friday, why do we want to be part of a regional Caribbean Cat Fund?
I'd suggest that a) our $1.5M contribution to the Fund could buy a much more economical Bermuda specific cover from some of our companies and b) we're going to pay out far more after Caribbean storms that we're likely to get back over time and c) why are we promoting state solutions when our economy is based on providing this in the open market?
There's an adverse selection issue at play for Bermuda in a Caribbean pool. Bermuda's premium is 100% diversifying for the Caribbean, the diversification benefit to Bermuda is far far less. This proposal is too concentrated in the Caribbean to be of much benefit to Bermuda. I can completely understand why including Bermuda is attractive to the islands in the Caribbean. Bermuda, on the other hand...
Has the Government explored private market solutions for us available just down the street?
This seems to have more to do with profiling in the region than any real economic value to Bermuda.
Posted by Christian S. Dunleavy