Allied World Assurance Company Holdings Ltd. plans to move its holding company from Bermuda to Switzerland, the nine-year-old company announced last night.

In a statement, Allied said its board of directors had unanimously approved the redomestication plan, which will be spelt out to shareholders in special meetings slated to take place later this year.

Allied stressed that its Bermuda insurance and reinsurance subsidiaries will continue to operate and service business in Bermuda where the company was formed in 2001.

The company expects the redomestication to be effective by the end of the year.

Allied will reveal more in a conference call scheduled for 10 a.m. next Monday morning and in a proxy statement it will file with US regulator the Securities and Exchange Commission.

"We are announcing our proposed redomestication to Switzerland as we believe the time has come to increase our focus on global distribution as well as global product capabilities," Allied's chief executive officer Scott Carmilani said in last night's statement.

"Allied World is nearing its 10th anniversary, having grown from a single office in Bermuda to 16 offices worldwide that service an increasingly global customer base.

"This redomestication will allow us to better manage our position in local markets around the world, as well as continue to maintain a strong presence in the Bermuda market."

Allied has formed a new Swiss company, Allied World Assurance Company Holdings, AG, that will replace Allied World Assurance Company Holdings, Ltd. as the ultimate holding company of the group.

The company, based on Richmond Road, Pembroke, has a market capitalisation of almost $2.8 billion and posted net earnings of $318 million for the first six months of this year. As of June 30 this year, it had total shareholders' equity of $3.47 billion.

Switzerland is proving attractive to Bermuda insurers. Ace Ltd. moved its holding company from the Cayman Islands to Switzerland in 2008. Flagstone Re moved the headquarters of its operating company to Switzerland, before moving its holding company to Luxembourg.

Amlin redomiciled its Bermuda reinsurance unit to Switzerland and Catlin formed a Switzerland-based reinsurance company with $1 billion in capital earlier this year.

XL Group also redomiciled its holding company from the Cayman Islands to Ireland during the summer.

Hiscox Bermuda Ltd. CEO Charles Dupplin told The Royal Gazette earlier this month that the Swiss had been actively courting Bermuda insurers, as representatives of Swiss business service providers had travelled to the Island to try to persuade executives to make the move to the Alpine nation.

Switzerland has a full tax treaty with the US, which is attractive to companies in jurisdictions that don't, such as Bermuda — especially at a time when the US is mulling tax changes that would impact non-US insurers.

Allied World Switzerland's shares are expected to continue to trade on the New York Stock Exchange under the ticker symbol "AWH".

And the company said it will continue to report its consolidated financial results in US dollars and under US Generally Accepted Accounting Principles.