2000 June

2000 June
The OECD excludes Bermuda from its list of harmful tax jurisdictions, following commitments from the Minister of Finance to toe the OECD line. To save face, the Minister refuses to make public exactly what he promised the OECD, which was the dismantling of protection for Bermudian-owned companies. Scottish Annuity & Life of the Cayman Islands establishes a joint venture with Crown World Services, a Bermuda designer and marketer of variable life insurance products.

July
Overseas Partners (OPL) buys Reliance Reinsurance, takes on its 50 staff in Philadelphia and rebrands it as OPUS. XL Capital starts a year-long restructuring, appointing Nicholas Brown to run its insurance business, Henry Keeling its reinsurance operations, and Robert Lusardi its growing financial products and services arm. Credit Suisse First Boston establishes Boston Re, its first captive venture, in Bermuda.

August
OPL reports a second-quarter loss of $497m, following reserve strengthening and the cancellation of its shipper's risk business from UPS, which earlier lost a landmark case in US tax court.

September
White Mountains Insurance Group agrees to pay $2.1bn for the US property/casualty operations of Britain's CGNU group. The deal would add $4bn in personal lines and business insurance annual premiums to White Mountains' otherwise minuscule business. Arch Capital Group, formerly Risk Capital Holdings, having sold its reinsurance business, announces it will move to Bermuda from Connecticut to become, broadly, a merchant bank for insurance and reinsurance companies. XL Capital forms Element Re to underwrite weather risk, both directly and with derivatives.

October
KPMG issues its report to the British Government on the financial services sectors in Bermuda and five Caribbean jurisdictions. Bermuda generally fares well, but the report recommends the establishment of an insurance supremo and the introduction of controls at the becalmed Bermuda Stock Exchange. Imagine Re is formed in Bermuda with $200m of capital, 90% of which comes from Trilon, a Canadian financial services conglomerate reinvesting the proceeds of its sale of London Life.

November
OPL continues its process of reinvention with the acquisition of a team of professionals from Stockton Re, a Bermuda finite reinsurer, led by Jed Rhoads. The new unit is dubbed OP Finite. Guy Carpenter opens a Bermuda office. Herbert Haag retires from PartnerRe, the company he founded seven years earlier, to return to Switzerland and write classical music; he is replaced by Patrick Thiele.

December
XL Capital, through its specialty insurance subsidiary, buys the US surety operations of CGU and merges it with its existing surety business, headquartered in Illinois. Everest Re Group, recently relocated to Bermuda from the US, buys AFC Re, a Bermuda-based annuity and life reinsurer. Aon buys IRMG, a Bermuda insurance manager founded by Fred Reiss (the ‘father of captive insurance'0), from Swiss Re.

2001 January
XL rebrands; Mid Ocean Reinsurance becomes XL Re and NAC Reinsurance is renamed XL Reinsurance America, with the marketing theme ‘Expect more'. Press reports of EW Blanch Holdings establishing a $750m run-off reinsurer in Bermuda, to be called Markitas, prove unfounded.

February
XL Capital buys Wintherthur International, the large commercial account property/casualty insurance business of Winterthur, from Credit Suisse, for $600m, having stalked Winterthur for two years, XL chief executive officer Brian O'Hara reveals. ACE announces it will enter the life and health lines when its non-competitive agreement with Cigna runs out in 2002. Sovereign Risk Insurance, a joint venture between ACE and XL, underwrites a $234m political risk insurance policy for the capital markets.

March
Winterthur Swiss Insurance buys Swiss Re's 71.4% interest of in Bermuda's Harrington Holdings and its subsidiary, Harrington International Insurance. Winterthur, which had previously assumed management responsibility for Harrington, now owns 100% of the company. John Charman, the largest individual shareholder in ACE and the force behind its Lloyd's operations, leaves following a dispute over personnel. Swift Intermediaries, a new insurance brokerage, is set up in Hamilton by Jo Lord and Richard Hornett, from Lloyd's.

April
CGNU takes an $800m charge for reserve strengthening that exceeds previous estimates, following delays in the completion of the White Mountains purchase. Willis, the world's third largest insurance broker, is to redomicile its ultimate parent company from the UK to Bermuda, and forms Willis Group Holdings specifically for the purpose. The largest reinsurance company domiciled in the Cayman Islands, Scottish Annuity & Life Holdings, announces it will move its corporate and international reinsurance operations to Bermuda.

May
Mutual Risk Management shores up its Legion subsidiaries with $112.5m from XL Capital and three other investors, First Union Capital Partners, High Ridge Capital and Century Capital Partners II

Three members of XL senior management will sit on MRM's board. XL Capital completes the move of all its Bermuda operations to XL House, a $110m, purpose-built facility of 464,000 square feet on the site of the former Bermudiana Hotel. ACE is to move its Bermuda operations into the ACE Building, a smaller facility on the other half of the same site, later in the year.