Bermuda is fast becoming the place for Latin American companies to set up their reinsurance and captive insurance businesses.

That is the view of Eduardo Fox, manager of corporate and Latin American Affairs at Bermuda-based global law firm Appleby, who recently attended a conference hosted by ALARYS (Asociación Latinoamericana de Administradores de Riesgos y Seguros - a body of risk management organisations in Latin America) in Sao Paulo, Brazil.

While there he questioned one of the main speakers, Sergio Medinabitia, risk manager for the PDVSA or Venezuelan Petroleum, which has a captive on the Island, about why the company choose to go to London first before seeking reinsurance cover in Bermuda.

And Mr. Fox believes, with every Latin American country, except Paraguay, having a presence or interest in the Island's insurance market, Bermuda could be set to see even more business come its way in future years.

Mr. Fox said he needed to seek reassurances from Venezuelan Petroleum, the largest oil company of its kind in Latin America and one of the world's top three, as to why it had decided to domicile its captive in Bermuda.

"Basically, I asked a question of the speaker, who was the representative from Venezuelan Petroleum, which is state-owned by the Venezuelan Government itself, about why they had to go to London and I knew all the answers, but I just wanted the audience to know the answers as well," he said.

"I wasn't surprised with the answer because they had to go to London based on what they heard from the previous regime.

"They didn't say that they wouldn't do it in the future, but the reason for them being in Bermuda was because of the incredible talent that exists here and it was not a tax reason.

"Everything in Bermuda was what they were looking for and because of the Bermuda insurance market being of such importance." Mr. Fox went on to reveal that Advanced Appraisals, the risk management team of Venezuelan Petroleum and a number of insurance brokers had teamed up in a bid to open up the Venezuelan and Brazilian markets to Bermuda.

"They were very willing to work with Bermuda entities," he said.

"Obviously, my firm has been involved in the Latin American development for a good 10 years and we are seeing the fruits of our labour now.

"The reinsurance market in Brazil is no longer a monopoly as of January 1, so there are a lot of opportunities there as well.

"Venezuelan Petroleum is the biggest company in Latin America and (by setting up a captive in Bermuda) they will open up the door for more companies in Venezuela (to get reinsurance cover or form captives).

"I don't think (President Hugo) Chavez intervenes that much with that side of things and leaves it to the experts."

Meanwhile, plans are afoot to bring the conference itself, which was last held in Bermuda in 2004, back to the Island in the future, said Mr. Fox.

He said, in the meanwhile, his company was working on developing a network of business throughout South America. "Of course, knowing the culture helps," he said. "Language is no longer a big problem and we have a whole new generation of experts in the field.

"It is going to take less and less time to do business with them and develop the new companies they want to form.

"We have that problem with the proximity issue with the perception of offshore jurisdictions in that the Cayman Islands is nearer to them geographically.

"But, just by selling the Blue Chip jurisdiction that is Bermuda, their interest and is accelerating and its just gets faster and faster."

With the likes of companies from Argentina, Chile, Colombia, Mexico, Brazil and Peru all coming on board in Bermuda in some capacity, most of Latin America, with the exception of Paraguay, which is still recovering from the hangover of former military regimes and years spent in isolation from the rest of the continent, the links being forged between the Island and its neighbours to the south are becoming ever stronger.

"The whole Bermuda insurance market has been involved in this, so it has been a typical Bermuda Inc. style effort in the past five to seven years on a united front to do this," said Mr. Fox.

"We were at the conference representing Bermuda, including the Bermuda Insurance Institute, the Bermuda insurance market and all of the main companies in Bermuda concerned with this, including insurance managers and banks."