Armed with recently granted US patents, Bermuda-based Investors Guaranty Fund, Ltd. has embarked on marketing financial methods and technologies designed to ride the wave of interest in insurance securitisation.

The company is hoping to make millions on its technologies, which it spent 13 years and millions of dollars in developing. Investors Guaranty is managed from Bermuda by the Freisenbruch-Meyer Group, whose director, Alasdair Barclay is president of the company.

"Investors Guaranty believes insurance risk securitisation has the potential to be as popular as the packaging of home loans, credit card receivables and other financial assets,'' the company stated in a press release. Insurance securitisation refers to the linking of insurance industry risk with capital market products such as bonds. For the insurance industry it's a means of raising capital or off loading risk. Investors are interested in the products as a means of portfolio diversification.

"The patented technologies involve methods and systems functioning like an exchange for the creation, placement and trading of debt, equity and other capital market securities linked to gains and losses on specific insurance and financial risk exposures,'' the company said in describing the products.

"Insurance risks are transformed into a new "asset class'' of capital market securities for pension funds, insurance companies, banks and other institutional investors.'' Mr. Barclay said the US patents were the successful result of a multi-million dollar research and development effort underway since 1985.

"We expect our technology will yield significant benefits to consumers by lowering insurance costs, and increasing the availability and stability of insurance coverage for very large, difficult to place hurricane, earthquake and other risks for which insurance capacity has been limited,'' he said.

Corporations will also gain by being able to provide insurance coverage for risks that may currently be self-insured.

Two of the company's patents cover methods of insurance securitisation using single purpose vehicles to transform insurance risks into capital market securities such as high yield bonds, equities, derivatives and principal and interest protected securities.

The patents also apply to data processing and communication systems used in exchange-based transactions.

The company's IFG System is designed to provide segregated securitisation for multiple investors and insurance risks that is more advanced and efficient than the single purpose vehicle, according to the company.

"This securitisation system addresses preference, claims of third party creditors and tax authorities, bankruptcy and other concerns that Investors Guaranty believes have been inadequately addressed in some of the early prototype insurance securitisation transactions completed in the past two years,'' the company said.