The Supreme Court has sanctioned a new scheme of arrangement for a group of four insolvent Bermuda reinsurers, paving the way for a final disbursement of assets.

The four companies shared the risks of a reinsurance pooling arrangement before becoming insolvent in the mid-1980's.

Yesterday, Conyers, Dill & Pearman lawyer Mrs. Robin Mayor represented the companies in a successful application for court sanction of a closing scheme of arrangement, to replace the reserving scheme of arrangement established for the firms in 1985.

The application, under section 99 of The Companies Act 1981, was designed to provide for a cut-off of the claims against the respective companies.

"It's no longer economically viable to continue with the first reserving scheme, the vast majority of reinsurance receivables having been collected,'' Mrs. Mayor told the court.

Because of insolvency the companies have been in run-off for 10 years.

Creditors voted in favour of the new scheme last month. When the closing scheme is concluded the companies will likely be dissolved.

Meetings were held in the UK, beginning in London on November 8 for creditors of Centaur International Insurance Company Ltd., the Concord Reinsurance Company Ltd., Marbarch Insurance Company Ltd. and Shasta Reinsurance Company Ltd. to consider the closing scheme of arrangement pursuant to the Bermuda Companies Act and section 425 of the Companies Act 1985 of Great Britain.

The closing scheme will affect a final disbursement for all creditors.

Since 1986, Centaur has paid out 40 cents on the dollar to creditors, Concord and Shasta have paid out 20 cents on the dollar while Marbarch has paid out not less than 20 cents on the dollar.

Closing schemes are an alternative to liquidation and are viewed as less costly than liquidation and possibly more beneficial for creditors.

The application was granted by Puisne judge, Mr. Justice Meerabux.