Re/insurers are almost 100 percent compliant with a self-imposed contract certainty code of practice, according to results released by the Association of Bermuda Insurers and Reinsurers (ABIR).

The code (published on the ABIR website at www.abir.bm), which was adopted in 2008 in conjunction with the Bermuda Insurance and Reinsurance Brokers Association, and in consultation with the regulator, the Bermuda Monetary Authority (BMA), binds its members to specific contract completion practices.

Data submitted by 16 members revealed that 91 percent of insurance contracts and 93 percent of reinsurance contracts starting on January 1 2009 were contract certain.

"The contract certainty results are reflective of the very high standards that we have long held in Bermuda and illustrate that companies and brokers are committed to meeting customers' needs," said Heather Kitson, chair of the ABIR contract certainty committee and general counsel of Aspen Insurance Ltd.

Michael Butt, ABIR's chairman and chairman of Axis Capital, said: "The results are exceptional. The room for improvement though is needed in the sample size.

"We hope to achieve greater participation by both the number of member insurers and the number of contracts measured."

Matthew Elderfield, CEO of the BMA, said: "The BMA welcomes the good progress made by Bermuda market participants to ensure a high level of compliance on contract certainty.

"These efforts have helped reduce the scope for operational risk and disruptive client disputes in the marketplace."

After the initial test results, the ABIR board has voted to continue to conduct measurements on contract certainty compliance by completing testing for calender year 2009 and continuing through 2010.

The effect of the ongoing measurement approach will be a constant reminder to counterparties of the need to be vigilant about reaching agreement on all contract terms before binding, said Leila Madeiros, ABIR's vice-president and corporate secretary. The initial measurement now becomes a benchmark upon which re/insurance companies will strive to build better participation and compliance in future years.