For over a decade, individual London market insuranceprofessionals have been trickling southwest to work in Bermuda,lured by lower taxes and a kinder climate. Until now, though, mostcompanies here have opted to play it safe and stick with theexpertise and breadth of opportunities concentrated in the warrenof streets and lanes which constitute London's financialheartland–known as The City.

That changed late last year when Lloyd's insurers Amlin andHiscox set up sizeable new operations in the mid-Atlantic tax havenahead of January 2006 renewals. They were soon joined byLancashire, a new company with strong Lloyd's links and a Londonstock market listing. Lloyd's insurer Omega is hot on their heelsand others are expected to follow.

All are keen to capitalize on the upturn in U.S. insurance ratesfollowing Hurricanes Katrina, Rita and Wilma, prompted by capacityshortages–especially in the reinsurance and retrocession markets.They have chosen to expand in Bermuda primarily for taxreasons.