forming a new reinsurer to cover large property catastrophe risks with limits of up to $500 million.

The joint venture, to be called Top Layer Reinsurance, will be based in Bermuda and will have a total capacity of up to $3 billion. RenaissanceRe and State Farm will each put up a $50 million letter of credit in financing. State Farm Mutual, the parent of State Farm Fire and Casualty will provide $2.9 billion in stop loss reinsurance cover.

State Farm sees the new company as a means of diversifying operations outside the US. State Farm is the largest writer of property-casualty insurance in the US.