Hiscox Plc, one of the UK?s largest specialty insurer, could reincorporate its parent company to Bermuda because of the strength of the Island?s insurance market ? outstripping the London market last year in reinsurance policy sales.

The news comes on the heels of the company?s decision to set up a Bermuda unit. reported on Monday that Hiscox had been given a green light by the Bermuda Monetary Authority, licensing it and six other highly capitalised insurance and reinsurance companies in recent weeks.

The companies are setting up in Bermuda to target higher rates for reinsurance and insurance policies after the industry was hit with an estimated $75 billion in claims so far this year, including the possibility that Hurricane Katrina could dent balance sheets by as much as $60 billion.

Chairman Robert Hiscox said: ?We have watched the growing market in Bermuda and for some time considered that we need to underwrite there to increase the spread, balance and distribution of both our global reinsurance and retail accounts.?

According to Standard & Poor?s Global Reinsurance Highlights Report of 2005, 13 of the world?s top 40 reinsurers are based in Bermuda, and Bermuda is the fourth largest reinsurance market in the world after Germany, the US and Switzerland.

And for the first time in 2004, Bermuda-based reinsurers? total net written reinsurance premiums exceeded those of London-based reinsurers.

While reinsurance net written premiums in 2004 grew 3.3 percent on a global basis, Bermuda-based companies grew by 15.9 per cent. ?This demonstrates the growing importance of the market,? Hiscox said in its bulletin.

Hiscox said it also expected to see a pricing advantage from being in Bermuda.

?In respect of US business, the acquisition costs have historically been significantly lower in Bermuda than in London which has given Bermudian reinsurers a pricing advantage that Hiscox Bermuda will in future be able to enjoy.?

And Mr. Hiscox said he believes, as do many in the industry, that reinsurance pricing will be strong following the spate of hurricanes this year.

Because a substantial amount of the Group?s business could originate in the Bermuda and US markets, management said the Hiscox board was considering redomiciling to Bermuda.

?Bermuda is a fast growing reinsurance market, which now sees business not shown in London, and has pricing advantages and a favourable regulatory regime,? Mr. Hiscox said.

?The time is right for us to open there.?

Hiscox?s new Bermuda company is to be initially capitalised with $500 million. Robert Childs has been named to head the Bermuda unit.