Most US-listed Bermuda insurance companies saw their shares fall on Wall Street yesterday amid the uncertainty ahead of last night's vote by Senators on a rehashed US bailout plan (see page 10).

But New York-based American International Group (AIG), which employs some 200 people in Bermuda, rose 19 percent in yesterday's trading.

AIG, which was saved from collapse by a government takeover, closed up 62 cents at $3.84, having earlier climbed as high as $4 on speculation that a bailout would help AIG with its credit default swap problems. New York Insurance Superintendent Eric Dinallo yesterday after trading ended that a bailout is "likely" to help if AIG's counterparties rid themselves of bad mortgage assets such as collateralised debt obligations.

Banks that bought credit-default swaps from AIG as protection "would presumably partake in bringing their CDOs to the desk" and then the swaps would be terminated, Dinallo said.

AIG, the nation's biggest insurer by assets, considered bankruptcy after its credit ratings were cut on September 15, triggering billions in collateral calls. The New York-based firm posted more than $25 billion in writedowns on swaps, the protection for debt investors that plunged in value as the securities they guaranteed declined.

Bond insurers Syncora Holdings Ltd. (up 31 percent) and RamRe (up 9.5 percent) also enjoyed a good day.

And reinsurer Flagstone, which announced it had completed its corporate restructuring plan that will see its Bermuda underwriting unit merge with its Swiss operation, gained nearly eight percent.

But most of the movement was downward, as Everest Re and Validus Re fell by around five percent, while Axis Capital, RenaissanceRe, White Mountains and XL Capital each lost around four percent.