At the 2025 Bermuda Risk Summit, industry leaders from across the re/insurance market came together to discuss the weighty topics of the day. Sharing insights into the common themes, David Govrin (pictured), group president and CEO of global reinsurance at SiriusPoint, noted that the LA wildfires remain on the mind of the market.
As the largest wildfire in the history of wildfire events, with reports estimating that it’s two and a half times larger than any previous wildfire, the resulting conversation is not limited to the wildfire itself, he said, but rather about climate change and the impacts of climate change more broadly. It’s a critical conversation, he said, not least given that the frequency and severity of climate events is increasing. That’s reflected in the fact that the five months between September and January saw the industry grapple with Hurricanes Helene and Milton, and the LA wildfires.
“It’s not that the industry can’t absorb these losses but it does point to that increased frequency and severity,” he said. “Hurricane Milton had ended up being a smaller industry event than was forecasted before landfall. But you can't lose sight of the fact that it moved from a cat one to a cat five in 24 hours, and was bearing down on Tampa.
“Year after year, we keep saying ‘this event was the strongest in history, or the earliest in the season, or it went from x-to-y quicker than any other storm’.” At some point, the conversation will have to start with the acknowledgement that the frequency and severity of these events are increasing, and focus on how to think about, price, and model these perils.”
Similarly to how the property conversation is dominated by US cat considerations, on the casualty front, the discussion is largely centered on the US market and the question of pricing adequacy. When you look at the casualty market, it’s critical to recognize that it’s made up of so many different sub-lines of business. “When people talk about casualty, it’s usually about US casualty,” he said. “And I think a lot of that conversation is on the adequacy of the price in recent years, and the impacts of social inflation and litigation funders.”
A third theme of the Summit centers on the regulatory environment, particularly in the US, he said, and the question of how regulators will respond to all the increase in loss frequency and/or severity – which is impacting the property market, but also multiple other lines of business, including US casualty. There’s a great deal of complexity in today’s risk environment but this is further compounded by the increasing interconnectivity of those risks, along with behavior risk.
Take, for example, the E&S market, he said, where there’s a lot of attention being paid to the growth in the market. “Historically, there was an ebb and flow between admitted and E&S market. When markets hardened, business moved from admitted to E&S. Then, as conditions improved, it moved back to the admitted market.”
The question for the US market now is whether the regulatory environment will result in a permanent or long-lasting change in that ebb or flow, with business remaining in the E&S market. “I think we’re going to be hearing a lot of conversation around that topic of the continued growth in US market share in the E&S market.”
The fourth theme of conversations at the Summit is not limited to the re/insurance market as it’s the same topic everybody is discussing at their own kitchen tables or when out with friends – how the overall geopolitical and economic environment is changing and the potential impacts of those changes. “It’s a complicated topic and it’s across multiple lines of business,” he said. “If you are thinking about rebuilding Southern California at the same time as you have potential fluctuations in the cost of materials, what does that mean for the market? And that’s just one example.”
What clients need, want and expect from their insurance partners is always changing, he said, but, amid so much complexity in the risk environment, there’s a greater emphasis than ever on the need for dependability, transparency and expertise. For companies like SiriusPoint, which count both ultimate end insureds and their broker partners as critical stakeholders, it’s interesting to see the importance being placed on dialogue.
“It all comes down to dialogue, to asking the right questions so we can understand the complexities that they face,” he said. “We’re out talking to our partners all the time because we recognize that, the more complexity there is, the more people want to deal with companies unburdened by bureaucracy. Our partners want to be able to engage in a conversation.”
For brokers, the complexity of today’s operating conditions is a real opportunity to be on the front foot when it comes to engaging with clients, and providing support where they need it most. “And the brokers are definitely engaging,” he said. “The thing that interests me is how brokers are investing in themselves, in data analytics and technology in order to be able to do that. And I think it’s clear that brokers are making these investments in order to able to continue to have the right conversations with their clients.”
