Now is an opportune time to be building up a new global insurance company, according to Clive Tobin, chief executive officer of Bermuda start-up Torus Insurance Holdings Ltd.

With upward pressure on rates and industry capacity shrinking in the midst of global economic turmoil, opportunities abound for newcomers unburdened by legacy issues. In addition, an unusually large number of highly qualified and experienced staff are seeking new jobs.

Mr. Tobin, who took over as Torus CEO on January 1, has already managed to attract at least two high-ranking executives from his former company XL Capital Ltd. and another two from American International Group (AIG) two companies that have been badly impacted by the credit crisis

Now focused on getting the operating machinery in place to set Torus on the path to worldwide growth, Mr. Tobin is well qualified for the job. For 12 years he worked at XL, playing a leading role in the Bermuda company's rapid expansion from a niche player into a global giant. He was CEO of its global insurance operations before leaving last year.

After the Briton's stellar career at XL where his globe-trotting duties required him to fly an estimated total of 2.5 million miles he decided to take some time out to spend with his family. He soon found his skills, knowledge and experience were in demand and he was lured into the hotseat by Torus chairman Mark McComiskey.

Torus was launched last June with $720 million in capital from First Reserve Corporation, a private-equity firm specialising in energy investments. Its operating entities Torus Insurance (Bermuda) Ltd. and London-based Torus Insurance (UK) Ltd. have been assigned an A- financial strength rating by AM Best.

Torus is a technical lines insurer specialising in large, complex risks, with a focus on the energy sector. Torus started writing business last July and had something of a testing start as hurricanes Gustav and Ike rampaged through the Gulf of Mexico. Its losses from Ike totalled around $20 million, Mr. Tobin said.

Mr. Tobin said some were intrigued as to why Torus was set up during a soft market to compete in an over-capitalised industry but things changed dramatically in the second half of 2008, as catastrophe claims and investment losses ripped through surplus industry capital.

"We wanted to build a technical insurer that would differentiate itself over time," Mr. Tobin said. "We expected the market to change, but we never anticipated it would change so quickly. The last six months have brought a huge change in the market."

Mr. Tobin is thinking big. By the end of this year, he wants to see all of Torus' operating platforms in place. Within five years, the goal is to employ at least 500 people in offices around the world and to become a public company in five to seven years.

Already Torus employs 50 people in London, 20 in Bermuda, and six in the US, a number that is set to rise soon following the opening of a new office in Jersey City. Next month, Torus will open a Chicago office and later in the year, it will look to open others in the southern US.

Torus is also opening an office in India, close to the capital, New Delhi, where the focus will be catastrophe and actuarial modelling, capitalising on the country's large pool of technical talent.

The struggles of established companies, which have been hit hard by losses from investments and catastrophes, have given Torus an opportunity to accelerate its growth plans through acquisitions and the opportunity to hire skilled and experienced staff.

In December, its reinsurance operation was given a head start when Torus acquired the renewal rates of New Castle Re, a three-year-old Bermuda reinsurer owned by hedge fund Citadel, which had moved out of the reinsurance business as it tried to raise cash to meet a rush of redemptions.

The deal gave Torus an established book of reinsurance business, as well as 15 employees from New Castle and the job of providing run-off services for CIG Re, an affiliate of New Castle.

On the insurance side, Torus acquired New York-based Praetorian Specialty. The deal allows Torus to do business as an excess and surplus lines insurer in 42 US states. Torus wants to enter specialty lines including directors' and officers' insurance, which has seen a steep increase in rates, particularly for financial institutions, during a wave of litigation against company bosses in the wake of turmoil in the financial markets.*t(0,0," ")

to hire some of those people to establish the best teams we can," Mr. Tobin said. "I believe this window of opportunity to hire good people will close in about six months. We will try to get the talent that's out there while we can."

David Perez, Torus' global head of casualty, was hired from AIG, as was John Williams, who will be the operations director.

Some of Mr. Tobin's former colleagues at XL Insurance have also opted to join Torus. Bob Klepper, hired as Torus' chief underwriting officer, global property, as well as head of US unit Torus Specialty Insurance, joined from XL. David Message, of XL, has also agreed to head up Torus's offshore energy underwriting team in London, in the near future.

XL made a net loss of $2.6 billion last year on problems related to the credit crisis. Despite having picked up some useful executives from his former employer, Mr. Tobin takes no glee in its plight.

we see upward pressure on rates after the havoc wreaked in the Gulf of Mexico by hurricanes Ike and Gustav and Mr. Tobin believes Torus is well positioned to take advantage of that

He sees other advantageous circumstances such as clients opting to include more insurers on their risk programmes, for financial security reasons, after major insurers suffered problems last year. "That has opened up a lot of business that we would not otherwise have had a chance of getting," Mr. Tobin said.

The erosion of available capital in the industry had sparked other trends that bode well for Torus.

Very few sidecars being set up. On the demand side, you're seeing clients wanting to buy more reinsurance. If a catastrophe event were to happen this year, I think the industry would have a tough time raising capital.

"The reinsurance hardening we're seeing will continue in 2009 and will start to impact insurance in 2010. Another big change we're seeing is that companies are making no investment income. So now people have to make an underwriting profit. They can't think about cash-flow underwriting any more."

"It's a tough time, but it's an amazing time for the industry."