But Starr Excess Liability Insurance Company, in exercising their stated intention to aggressively search for new business, will only open this summer what they describe as a contact office there.

The office will mainly consist of someone involved in the process of developing potential new business, perhaps with some clerical support.

Senior vice president, Mr. Joseph Wiedemann said: "It is an outgrowth in a market that could be developed. We have seen a lot of activity in London and we think it is prudent that we look at it more closely.

"But it will be a contact individual only, so that we can provide better service to potential new clients. Ultimate decision making will still be done here in Bermuda. All the business will be done from Bermuda. All the underwriting will always happen here.'' The move comes after alert brokers indicated that there were risks that would consider moving out of the London market.

"We believe by having a presence there," said Mr. Wiedemann, "we can capitalise on new business opportunities. Our office will be in the Lloyd's building.'' "We will be there as another alternative in the event that a broker looks to place business outside of the London market.'' There are less than half as many syndicates doing business in the London market as it was at the beginning of the 1990s. Mr. Wiedemann said that there are some 170 syndicates left there, after some 200 syndicates either merged or went into run-off. Informed sources say more closures can be expected.

Starr's move on the London market is expected to bring significant new business to Bermuda.Much of the London capacity for high excess levels has fallen away.

There is a growing demand among foreign-based multi-national corporations for excess insurance, a change Starr Excess said is driven by changing legal and social trends in their own jurisdictions imposing increased liability, as well as by virtue of the concern of such corporations with respect to liability exposures in their US operations.

Starr's arrival on the scene 10 months ago brought some degree of apprehension from their competitors, but today the company does not believe that it has taken away their business in any meaningful way, but feel that they have opened new opportunities.

Mr. Joseph Johnson, president and CEO said: "What Starr has brought is another alternative for the brokers. The Bermuda market is now a primary market, no longer one of last resort.'' Mr. Wiedemann said: "There is an advantage to the way companies are structured here. The earnings can accumulate and go to surpluses, and then can be used to write more business.

"Starr made it clear from the outset that we would pay no dividends in the early years of our operation.'' Business to the past week has included the writing of some $52 million in directors and officers and excess liability insurance since their start up in June. They now have 108 policy holders.

That compares favourably to The American Excess Insurance Association that has been operating since 1986, and has written $43 million in premiums, with 125 policy holders.

"That says something for the credibility of the Bermuda market, '' Mr.

Johnson said.

The company will be looking for other markets in the world. They say that the need for higher limits will continue to grow. Additional risks will be seeking those limits in the future.