and this year will utilise their net capacity and substantial capital to create both new products and innovative approaches to existing insured exposures, a new study has reported.

The Bermuda insurance market was highlighted in the just released study, Insurance Market, Trends & Developments, published by Sedgwick's national broking division in the US.

In discussing XL Insurance Company Limited (XL), the annual report forecasts rate increases for the chemical, pharmaceutical and oil/gas accounts. But they add that in an effort to retain some of their softer accounts, XL expects to affect some reductions in price.

The study reports that XL is this year focusing on opportunities in the Far East/Pacific Basin as well as Fortune 500 prospects. This year's contracts are multi-year, multi-line policies for global accounts and XL have announced new insurance products.

The Sedgwick report stated: "They (XL) will be finalising their electronic broking mechanisms with the major brokers as they continue to strive toward quality and efficiency.'' There was mention of ACE Insurance Company Limited's purchase of a Lloyd's syndicate (the Methuen acquisition) and a cat reinsurer (Bermuda-based Tempest Re).

The report continues: "They have brought their excess liability policy more on line with XL's and are continuing to write property and aviation insurance on a follow form basis.

"ACE's D&O (directors and officers liability) writings remain the world's largest, but they are increasing pricing for a number of high-tech D&O accounts.

"ACE has established themselves in the blended/finite insurance/reinsurance area and will be writing unconventional and "difficult'' accounts from a capacity and pricing standpoint during 1996.'' The document said of Starr Excess Insurance Company Limited that flexibility held them in good stead during 1995 and they are continuing that approach this year without expanding into other classes of business.

The report sees Chubb Atlantic Indemnity Limited as firmly established in Bermuda as a niche-type insurer.

It states: "Chubb will add value and capacity to large programmes by being able to participate below the usual minimum Bermuda $25 million attachment point and manuscripting policies ranging from punitive damages cover to some E&O or workers comp covers as well as following the ACE, XL, Starr Excess liability policies.