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Bermuda reveals its resilience

If someone asks what “resilience” means, here’s a working definition: Getting back up again after being knocked down by a one-two punch.

That’s just what Bermuda did after Hurricane Gonzalo scored a direct hit two weeks ago, disabling power lines, ripping roofs off houses, and uprooting trees. Bermuda is back on its feet and open for business.

The hurricane was the second storm to strike Bermuda in one week. Days before Gonzalo made landfall, Tropical Storm Fay struck Bermuda, also damaging homes and downing trees and power lines.

Still, Bermuda suffered neither deaths nor serious injuries. Approximately 70 percent of Bermudians had their electricity restored within 48 hours of Hurricane Gonzalo’s assault.

Bermuda’s remarkable resilience reveals the special qualities that make this self-governing British overseas territory an important friend, ally and economic partner for the United States. It also offers valuable lessons for our American friends in preparing for and coping with natural disasters.

While grateful for American and British flyovers and assistance, Bermuda bounced back from the hurricanes because of its painstaking preparedness and self-reliance. An island in the Atlantic which is about a two-hour flight from major East Coast gateway cities, Bermuda primarily depends on its own know-how and hard work.

Understanding that it is in the path of major Atlantic storms, Bermuda enforces strong construction codes requiring all buildings to be made of concrete blocks. The result: During weather emergencies, people, pets and property all are protected. When disaster strikes, Bermudians rely on their own resourcefulness, avoiding a culture of dependency. As a free-market democracy, Bermuda encourages entrepreneurial solutions to economic and climatic challenges.

As a result, Bermuda’s vibrant insurance industry is playing an indispensable part in the country’s recovery from Hurricane Gonzalo and Tropical Storm Fay.

A very high percentage of Bermudian homes have property insurance, and, unlike the U.S., customers buy combined hurricane coverage that includes wind and water damages. Claims for damages from Gonzalo and Fay began the process of being paid within days, relieving human suffering and reducing economic losses.

Bermuda’s successful response to property losses makes the territory a great center of knowledge about catastrophic risk management.

This experience and expertise have helped to build the island’s insurance industry, which is essential to the economic ties between the island and the U.S.

Bermuda-based reinsurance companies provide about two-thirds of the backup coverage for home insurance in the U.S. This is especially important for disaster-prone areas, such as Florida, with its history of hurricanes, and the San Francisco Bay area, with its earthquakes.

In the aftermath of natural and man-caused disasters over the past dozen years, Bermuda’s insurers and reinsurers have contributed an estimated $35 billion in catastrophe claims payments in the U.S.

These include: an estimated $3 billion in reported losses by Bermuda’s reinsurers for Hurricane Sandy, which struck the Eastern Seaboard from Florida to Maine; $17 billion for Hurricane Katrina and $2 billion following tornados from 2010 to 2012; and $2.5 billion after the destruction of the World Trade Center.

Insurance is only one part of the cooperation between Bermuda and the U.S., from bilateral trade to international security and environmental science. On the economic front, Bermuda is a reliable market for American products, with the U.S. providing 75 percent of its imports.

From World War II through the Cold War and the current war on terror, Bermuda has provided the U.S. with bases for Air Force refueling and aircraft searching for hostile submarines and other vessels in the Atlantic. Now that it is so important to tackle money-laundering and terrorist financing, the Bermuda Monetary Authority can slap substantial penalties on financial institutions that fail to comply with international standards and the island’s laws.

In this era of extreme weather, Bermuda is also working with the U.S. to learn about and limit the impact of climate change. Over the coming year, Bermuda will incorporate the lessons learned from Gonzalo to study climate change in the Atlantic, assess coral reef damage and continue its work on conserving endangered species.

Respect for nature, representative democracy and the rule of law - these shared traditions have forged lasting ties between Bermuda and the U.S. So do the resilience that the U.S. and Bermuda both display after natural and man-caused catastrophes — and the insurance sector that helps our societies build back, stronger than ever, after every disaster.

Cheryl Packwood is the overseas representative for the Government of Bermuda, responsible for the Americas and Asia. She also directs Bermuda’s Washington, D.C. office. Readers may send her email at

©2014 Cheryl Packwood