reports on the FTSE/BSX index The Bermuda Stock Exchange today in London is launching an index tracking the stock market performance of Bermuda-based insurers and reinsurers.

The FTSE/BSX index is based on the stock market performance of the companies.

The insurance index was created by FTSE International -- a company owned by the London Stock Exchange and the Financial Times. It is designed to help investors make performance comparisons between insurance companies operating in Bermuda with those based in the US and Europe.

BSX chief executive officer William Woods and FTSE International managing director Mark Makepeace will hold briefings today at Saint Alphage House, FTSE headquarters in the City of London.

They will first brief London's leading insurance analysts. The briefing will be followed by a press conference attended by reporters representing 15 insurance publications.

The index will be published daily in the Financial Times. It will also be distributed by Reuters news agency. The BSX is currently negotiating to publish the index in The Royal Gazette .

The index seeks to demonstrate the "Bermuda effect'', a theory that insurance companies operating in a low tax location like Bermuda perform better than those based in onshore locations.

Initially the index will track 11 companies operating in Bermuda: Annuity & Life Re Ltd., ACE Ltd., EXEL Ltd., IPC Re Holdings Ltd., LaSalle Re Holdings Ltd., Mid Ocean Re Ltd., Mutual Risk Management Ltd., Partner Re Ltd., Renaissance Re Holdings Ltd., Stirling Cooke Brown Holdings Ltd., and Terra Nova (Bermuda) Holdings Ltd.

The index is market capitalisation weighed. Mutual Risk Management chairman Robert Mulderig will supervise the design and management of the index.

The BSX eventually plans to create options based on the index. The options will allow investors to buy into the overall performance of the Bermuda insurance market. The BSX hopes to licence the index and list catastrophe bonds.

Mr. Makepeace has said the index will help raise the profile of the Bermuda insurance market around the world. FTSE International manages and develops equity and bond indices, including all those of the London Stock Exchange and the Financial Times. The indices are used by investment managers for analysis, performance measurement, benchmarking, asset allocation and as the basis for index tracking funds.

In Bermuda, Kast Investment Management Ltd. and MRM Securities, a subsidiary of Mutual Risk Management, are working on designing a mutual fund tracking the index. Investors will be able to invest in Bermuda's insurers in one shot by investing in the fund. "We are designing it for the Bermuda community so it will be accessible to the general public,'' Ann Kast said yesterday.

The BSX is also working to create a catastrophe risk exchange with US-based Catastrophe Risk Exchange Inc. sometime this year. CATEX International will be Bermuda's first fully electronic trading and communications system through which members can cede, exchange or purchase risk.

BSX CEO William Woods