impression on shipowners after just a month of quoting on business.

The new Bermuda company's president, Neil Clemens, said, "SIGCo is emerging as the leading commercial provider of COFR guaranties for shipowners, in respect of all types of tankers and dry cargo vessels.

"Shipowners who previously obtained their COFR guaranties from First Line and Shoreline are now transferring to SIGCo.'' Reasons cited by brokers and ship owners for this success include a long term commitment by the company founders.

SIGCo is licensed as a Class 3 company with paid up capital of $25 million, and a corporate structure which provides that its ordinary shares are beneficially owned in trust for its shipowner clients. Those same clients will be board of directors of a private trust company that will act as trustee. It ensures their interest in the net worth of SIGCo.

Stockton Re, ACE Insurance and Global Capital Re, together with a number of other investors have provided the redeemable share capital. These shares are to be phased out over time, leaving ownership of SIGCo solely in the hands of the ship owner's trust.

Brokers and ship owners see the new programme succeeding for other reasons, including SIGCo's corporate structure; the absence of mutuality of risks; no broker affiliation; an independent, dedicated and experienced management team; and competitive pricing.

Said Mr. Clemens, "The shipowners have enjoyed this year reductions in pricing. We have refined the agreements of the fixed premium concept offered previously by First Line to make them more user-friendly. We bought shipping industry expertise into the fixed premium approach.

"The shipowners who pay the premium will in the long term end up owning the company and have a significant element of control.

"First Line and Shoreline were thrown into a big market position overnight, as a result of P&I Clubs not covering COFR costs, originally. The shipping community saw it as money going out of the system. Now, we've been able to capture the benefit of those premiums in the future for shipowners. It mitigates the cost of those premiums to the shipowners because they can see some future benefit from their money. The money is being retained in the system and costs could continue to fall.'' Approved by the US Coast Guard, SIGCo is providing COFR guaranties up to $400 million for shipowners who are members of all International Group P&I Clubs.

A comprehensive reinsurance programme is in place to protect SIGCo against exposures of $399 million in excess of a retention of $1,000,000, per vessel per incident.

The fixed premium structure of SIGCo has been designed to meet the demands of ship owners in respect of this difficult risk, which the P&I Clubs prefer not to cover within a mutual structure.