HSBC plans to take out more insurance risk in a bid to slash costs and raise hundreds of millions of dollars in revenue.

That is according to London newspaper The Independent, which claims, the international bank, which owns the Bank of Bermuda, is set to take out policies on its own books to maximise its scale and diversity.

The paper quotes Clive Bannister, group managing director of insurance at HSBC, as saying he will capitalise on the bank's liabilities being well spread between countries and businesses by retaining more risk within the group.

The bank is drastically reducing the number of insurers it uses to provide products and reinsure risk, while incurring more insurance risk from its businesses and customers.

"It is a change in the way we are thinking about our risk and the way we wish to engage with our preferred strategic partners," said Mr. Bannister.

"In the old days, you had two ways of getting rid of risk: you didn't write it or you reinsured it.

"We are now retaining more risk in two places."

In the past the bank had insured itself through its captive insurance company based in Bermuda, which covers a range of products including crime, property, professional indemnity and medical insurance, said the paper, with group premiums going through Bermuda increasing by about 40 percent, thus retaining almost half of its annual premiums worth $300 million.

But HSBC plans to take a slice of revenue from reinsuring the policies it sells to its customers in order to turn its Dublin reinsurance company into a major income source.

Then bank, until recently, had been working with more than 100 insurers supplying policies for the group or for it to sell to its customers.