In his opening comments at IBC's 7th annual executive forum on captive insurance companies, being held in the Cayman Islands this week, Governor Peter Smith said: "The shape of the financial industry has changed." How right he was.

The shape of the Cayman financial sector has changed in the last two weeks, with Gordon Rowell, the head of insurance at the Cayman Islands Monetary Authority reporting the formation of 15 new captives in Cayman in the past fortnight. "I'm sure that level of interest is being experienced in Bermuda, too," he added.

The captive industry is busier now than it has been in a very long time, perhaps ever. The events of September 11 and subsequent rate increases and capacity shortages have persuaded chief financial officers and risk managers that a captive, an idea that may have been on corporate back burners for a while, is now a peculiarly potent notion.

Just about all the 200 delegates at this conference would be in agreement, and evidence is everywhere. For one thing, the conference has attracted a higher percentage of captive owners and potential captive owners than is traditionally the case. For another, despite being one of the first international conferences to be held since September 11, a large number of delegates booked and almost all of them have shown up.

Mr. Rowell, in his remarks to the conference, made another telling point. He is of the view, widely held here, that the effect of the recent alphabet soup initiatives - OECD, FATF, KPMG and the others - has been to create a two-tier offshore community. He spoke of there being only a small number of jurisdictions in the top tier. After his comments, speaking to The Royal Gazette, he identified the members of the top tier as Bermuda and Cayman, Guernsey and Jersey and the Isle of Man.

He also spoke of a new initiative that is looking into the world's financial regulatory and legislative systems, this one being engineered by the International Monetary Fund. Just what we need, you might think, another acronymic body out to cause trouble. If you think that, you would be wrong.

Mr. Rowell's point, echoed by just about everyone, is that the top tier of jurisdictions stands only to gain from these initiatives. The evidence is in the surge in interest in captives and reinsurers in Bermuda and Cayman since the OECD excluded the two jurisdictions from its infamous list.

The keynote speaker at the first full day of the conference - which concluded last night with a visit to Government House - was Richard Feldman, special counsel to Glock, Inc., manufacturers of semi-automatic guns. His topic was `Insuring unpopular products', although he was quick to point out that, in the United States at least, guns are enormously popular. He suggested that "insuring controversial products" might be a better way of describing his topic.

Bermuda is not a gun-based society, and nor is Cayman. The most interesting component of his comments, therefore, was a crash course for insurers in how to handle the media, including print reporters, to whom he referred as "pencil people".

Mr. Feldman, who was at one time an advisor to former US President Ronald Reagan, suggested that companies follow these simple rules when dealing with the media:

1. Have a single spokesman, rather than several. Too many voices will undoubtedly lead to a confused message.

2. Do not lie when talking to the media. They will find out, sooner or later, and you will end up with egg on your face.

3. Withhold such information as you consider necessary to withhold. It is the reporter's job to define the questions, not yours.

4. Have a plan and stick to it.

5. Build a relationship with individual reporters.

6. Think of it from the reporter's perspective; make what you have to say interesting and informative.

7. If you cannot live with what you are saying, don't say it.

8. Have some "quotable quotes' ready on the subject.

9. "Be accurate, but jazz it up". Make your story interesting, rather than a dry recitation of facts.

10. Sound reasonable, no matter how strongly you believe what you are saying.

Although not all reporters would agree with every one of those ten commandments, they must work; Mr. Feldman's comments were extremely well received.

The conference continues through to the end of the week.