Brit Insurance Holdings Plc yesterday became the latest Lloyd?s of London insurer to announce plans to create a Bermuda-based reinsurer.

Brit has invested $21.1 million in Norton Re and will provide underwriting, claims and management expertise for the company, which expects to start operations in January.

Brit, one of the largest Lloyd?s underwriters, said Norton Re will be a Class 3 reinsurer proving retrocessional ? reinsurance for reinsurers ? natural catastrophes. Brit has a 19.6 percent stake in the company, which will have $107.7 in total capital.

Brit?s model is similar to that of Advent Re, which announced it was being formed earlier this month.

Advent, which will also offer retrocessional coverage, will have capitalisation of $37.5 million, drawn from a share offering of around $19 million and a debt issue of up to $20 million.

There has been a lack of retrocessional capacity in the reinsurance market since the record 2005 hurricane season.

Advent also cited Bermuda?s less onerous capital requirements than the United Kingdom and quicker recognition of profit for capital purposes as key reasons for the move.

Both underwriters join a number of others who have either moved their domiciles to Bermuda or have set up subsidiaries.

Earlier this week, Hiscox completed moving its domicile from London to Bermuda having established a subsidiary on the Island in January, while Omega Underwriting is also in the process of moving its domicile, Catlin, another leading Lloyd?s underwriter, moved its domicile earlier this year.

The ?British Invasion? has caused concern in the City of London and in the British Treasury, although the companies say they will continue to maintain a major presence at Lloyd?s, the world?s oldest insurance market and that the London and Bermuda markets are complementary.

The board of Norton Re said an experienced underwriting team led by Brit?s David Jordan and Andrew Cunningham, is already established in Bermuda.

?Norton Re will provide a blend of ?one-shot? ultimate net loss, excess of loss retrocession cover on both a USA and ex-USA basis during the coming January 1 renewal season,? the statement said.

?Third-event worldwide policies will also be written to complete the portfolio plan. Norton Re will not be a seeking a standalone of security rating but instead will be offering a full cash collateralised product, ensuring its clients enjoy superior security.

?The past couple of years have seen a dramatic shift in the availability of UNL retro protection. We are aiming to provide capacity to reinsurance entities to purchase meaningful risk transfer products and give our clients a secure reinsurance contract that will respond to catastrophic natural perils events.?