called into question by billionaire investor and chairman and chief executive of Berkshire Hathaway, Mr. Warren Buffett.

Business Insurance reported this week that during a shareholders meeting last week, Mr. Buffett, known for his savvy investment decisions, "bemoaned the ease of creating property catastrophe reinsurance facilities in Bermuda, where several facilities have been formed over the past few years with more than $4 billion of capital''.

The article quotes Mr. Buffett: "Most years, there are no losses, so the odds are very good you'll have beautiful results the first few years.'' But he questioned how viable some of the facilities would be after a catastrophe strikes.

He cited Berkshire's statutory surplus of $13.4 billion at the end of 1994, and noted that no other super cat underwriter can absorb as large a loss as it can.

"We can take a billion dollar loss, and we will take a billion dollar loss at some time,'' the magazine quoted him as saying.

But senior vice president and chief financial officer of Bermuda-based Mid Ocean Reinsurance Company Ltd., Mr. Charles F. Hays, told The Royal Gazette yesterday: "There's no doubt that Mr. Buffett's Berkshire Hathaway is an enormous company with lots of capital. It has the ability to write certain kinds of business that most people in Bermuda don't write.

"So I find it an interesting juxtaposition that he would be making comments about Bermuda for a lot of what we would call super cat business, because I don't think that anyone in Bermuda writes that business.

"Secondly, he probably also writes business that competes with some of the business that Bermuda writes. Therefore what he arguably is bemoaning is the fact that there is competition out there, and the implication is that because people can't take a billion dollar loss, they are somewhat unsound.

"One dares to question what an icon like Warren Buffet said, having not been there, but you could certainly write business in a very well capitalised, conservative manner, which many people in Bermuda do, without risking going out of business, which is sort of what the implication of the article is.

"He has an enormous company that can take enormous bets, which he has done very successfully. The companies in Bermuda aren't that way. That's not what they do.

"They do write catastrophe business and they write it in a well-managed, conservative fashion, which means they don't have to have all of the capital he does. It still doesn't mean that those companies are not very sound or very safe.

"In the end, it sounds like he is sort of bemoaning the fact that he has competition he didn't have before.'' The article referred to a November edition of Business Insurance, in which Mid Ocean president Mr. Michael Butt said that Bermuda's new capital requirements prevented weak companies from forming here.

Mr. Butt had estimated that catastrophe losses would have to total at least $30 billion before the Bermuda facilities would have to use their capital to pay losses.