Following the collapse of the Francis Scott Key Bridge in March, the Bermuda Monetary Authority (BMA) has requested that re/insurance groups and commercial insurers include preliminary loss estimates in their quarterly financial returns for the period ending March 2024.
This directive comes as part of the BMA’s ongoing effort to monitor global catastrophic events and assess Bermuda’s contribution to reinsurance coverage.
As per a news release, the BMA has made the latest quarterly financial return templates available on its website, with the only change from the previous quarter being an update to the liquidity risk calculation for general business insurers reporting under International Financial Reporting Standards.
BMA states that this update aligns with the newly prescribed Insurance Account Amendment Rules 2024 format.
In a statement, the BMA emphasized the significance of including exposure data related to the bridge collapse, which occurred on March 26, 2024, in Baltimore, Maryland, USA. Re/insurers are instructed to report this information in the “Catastrophe Exposure” tab of their returns, specifically under “Underwriting Loss Event #1.”
Companies are also expected to account for various types of losses connected to the incident, including property damage, liability, and contingent business interruption. Recognizing that these loss estimates may still be evolving, the BMA has asked re/insurers to provide their best preliminary estimates when submitting their quarterly returns.
The BMA noted that it continues to monitor the situation closely, ensuring that all relevant data is collected to support effective risk assessment and management.
According to investment bank TD Cowen, the insured losses stemming from the event could ascend to unprecedented levels in the marine insurance market, potentially reaching between $1.5 billion and $3 billion.
That said, TD Cowen maintained a positive outlook for the insurance sector, as anticipated losses are expected to be predominantly absorbed by marine reinsurers.
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