Hiscox Plc, a Lloyd's of London insurer that formed a Bermuda unit in recent months, yesterday said it has established a US office, broadening its reach into a region that already accounts for 40 percent of its business.

"We want to expand our footprint in the US market," said Robert Childs, the group's underwriting director, chief executive in Bermuda and newly named chairman of Hiscox USA. "It is an exciting development, we have been waiting for some time to get this going."

Hiscox USA is now licensed to sell policies in the US, and also has a licensed managing general agency to sell certain policies across the US underwritten on behalf of group companies.

To date, most of the policies Hiscox sells to US customers are placed through its Lloyd's business. And Mr. Childs said he expects some of that business to also now flow through Hiscox's Bermuda office, a company established in December with $500 million in capital.

"Certainly we would look for the US (business) to be supported by the US and Bermuda operations."

Hiscox USA, based in Armonk, New York, will initially focus on selling professional indemnity insurance, policies to protect against losses arising from claims alleging injury or damage by the insured. Within six months, Hiscox USA plans to expand its business to include broader specialist risks including terrorism, technology, media, telecommunications and fine art insurance.

Armonk, and the surrounding area, is attracting increasing insurance business. Swiss Re, for example, has an office in Armonk and one Bermuda-based Endurance Specialty has an operation in nearby White Plains. Armonk, a small town in Westchester county, is 30 miles from midtown Manhattan.

Mr. Childs said he expects the US office to see continued growth, and explained that it requires more staff than the Bermuda office.

Hiscox's New York office is to primarily sell insurance for small and mid-size US professional service businesses.

"It is small ticket to mid ticket business, and it is more labour intensive," Mr. Childs said of Hiscox USA's business plan.

The group has already hired 15 underwriting and professional staff for its US office, and plans to add more.

Hiscox Bermuda, which has now secured permanent office space in Wessex House, Reid Street, currently has eight staff, and the employee count should grow to 12 by May, Mr. Childs said. He doesn't expect to grow beyond that, for the present. The unit expects to underwrite about $350 million in policies this year, it said earlier.

The Bermuda book of business includes reinsurance, or insurance sold to other insurers to spread the risk of loss. Reinsurance policies generally carry a greater risk of loss than insurance contracts, and attract higher premiums.

Mr. Childs, who has worked for Hiscox since 1986, divides his time between London, Bermuda and the US.