to the limit, a corporate lawyer has claimed.

Conyers, Dill & Pearman partner Ms Robin Mayor told the Ninth International Reinsurance Congress last week that insurancer and reinsurance insolvenies were to complex and interwoven to fi neatly into the existing framework.

Her speech comes almost a year after Mentor Insurance Company liquidator Mr.

Charles Kempe told The Royal Gazette : "Recommendations have gone to the Finance Ministry and have come from the professionals involved in Mentor and from BIBA (Bermuda International Business Association) and the Law Reform Committee. They have been assembled over the last two or three years.

"There have been codified a number of revisions to Bermuda's insolvency sections which will get into law probably over the next year which will tidy up a lot of the loose ends that we experienced with Mentor.'' Mr. Kempe said at the time that he hoped that the Government would move as expeditiously as possible to make broad-based changes.

Ms Mayor said Bermuda's statutory framework for liquidations provides a relatively simple method for mounting a liquidation.

Apart from the basic provisions, a liquidator has to expedite the recovery of company assets and pursue delinquent officers, directors and third parties, which may have contributed to the company's demise.

But because of the complexity of the insurance/reinsurance business, she said, the legislative framework "tends to fall short in the manner in which it gives directions and guidance to liquidators in how to deal with certain matters, but also in certain time frames for assessing claims''.

She argued: "Quite simply, the insurance/reinsurance business, is too complex and interwoven to fit neatly into the statutory framework... "The whole process of assessment of inwards business and claiming on the outwards is extremely expensive and time consuming and, as witnessed recently certainly in the London market, and on a smaller scale in the Bermuda market, the moment a company goes into liquidation, reinsurers appear to find numerous reasons not to pay.'' Although some form of a scheme of arrangement has been used increasingly in the UK, and here at home, Ms Mayor said that it is an option that does not solve the problem of collecting reinsurance recoveries.

She said, "The scheme or the insolvency regime must allow for the proper assessment of claims upon which a claim on reinsurance in respect of that claim can be made.

"This is surely a factor that should be considered in any proposals for reform of insurance company insolvency.'' Bermuda is not the only country where reform is being called for. Ms Mayor discussed also the fact that there is some hope for revisions to the liquidation framework in the UK and the US.

But she stated:"In my view, estimation (of claims) and cutting off claims is the single most important and difficult issue facing insurance insolvencies, particularly in the light of increasing liquidations of companies who have written environmental and pollution risks which, on some analyses, are incapable of estimation.'' Registrar of Companies, Mr. Kymn Astwood, conceded yesterday that while the area "has been identified as one deserving a review, firm proposals to change the legislation have not been developed as yet. But work is continuing on it in the review process.'' Mr. Astwood said that there had been elements of some proposals dealing with "problem companies'' that were incorporated in the recent Insurance Amendment Act.

"We have been doing some work on this area, but a tremendous amount of work still needs to be completed. And that project is ongoing.'' Mr. Astwood said: "I'm in the process of looking at forming another committee. Previously, the committee that dealt with the insurance legislation also looked at this area briefly, but not in sufficient detail to start changing the law.

"It is a very complicated area that's going to require quite a bit of study.

And this is something that I've been talking with some of the insolvency practitioners about and we would like to form a committee to make the necessary study.

"One option is to do it through the BIBA (Bermuda International Business Association) Company Act committee. The official position is that we certainly have identified this as an area that needs some attention. Quite a bit of work needs to be accomplished prior to making any changes to the legislation.'' In the Mentor case, as Mr. Kempe explained last year, liquidators had to return to the Supreme Court of Bermuda some 75 times to seek direction and clarification.

He said: "The majority of those directions have been sought to obtain clarification in situations where the statute, or regulations, governing the winding up of companies is unclear or silent completely. They don't deal with today's commercial reality.'' And said Mentor joint liquidator, Mr. Nigel Hamilton, partner in Ernst & Young in London, "There was no provision really for the winding up of these types of entities. Reinsurance companies. There was provision for the winding up of a company, but nobody had ever envisaged `in terms of the writing of the law, either here or anywhere else really, about the length of times involved and the fact that you couldn't actually decide what the liabilities would be for such a long time.''