Hiscox Plc, one of the UK?s largest specialty insurers, expects its new Bermuda operation to be off the ground within weeks ? putting it in line to sell policies at January 1.

Chief operating officer Sue Langley, who was on the Island last week for meetings and to secure office space for the new $500 million venture, told the group had put ?a lot of energy behind making our Bermuda office operational?.

Hiscox?s Bermuda underwriters are to arrive later this month, she said, and will be ready to sell 2006 contracts.

Reinsurers sell the greatest number of policies each year during the January 1 renewal period. This is putting pressure on a new wave of highly-capitalised insurance companies entering the Bermuda insurance market, as each scrambles to get their offices and staff in order in time for the pivotal renewal season.

The companies ? at least nine already have licences in hand from the Bermuda Monetary Authority ? are setting up in Bermuda to target an expected increase in rates for reinsurance and insurance policies after the industry was hit with an estimated $75 billion in claims so far this year. The biggest dent is coming from Hurricane Katrina, which could wipe as much as $60 billion from insurers? balance sheets.

Hiscox, which was granted its Bermuda insurance licence in October, previously announced that Robert Childs, 54, currently managing director of Hiscox Global Markets and active underwriter of its Lloyd?s Syndicate 33, is to relocate to the Island as chief underwriting officer. The Bermuda unit is to sell both reinsurance and insurance policies.

Hiscox is raising initial capital for the venture through a rights issue for the equivalent of $297 million, with the balance to be borrowed from banks.

Four other staff from Hiscox?s London operation ? underwriters and modellers ? will also join Mr. Childs in Bermuda. And Ms Langley said Hiscox is also hiring in Bermuda, with several job offers made already.

The Bermuda unit will outsource its IT and financial work to its parent company. It has a one-year lease for space in the IAS building on Church Street, while the group continues to look for more permanent space.

Hiscox, a company active in the Lloyd?s of London market, has said it could eventually reincorporate its parent company to Bermuda because of the strength of the Island?s insurance market, which last year beat the London market in reinsurance policy sales.

Hiscox chairman Robert HisHiscox chairman Robert Hiscox said earlier this month: ?We have watched the growing market in Bermuda and for some time considered that we need to underwrite there to increase the spread, balance and distribution of both our global reinsurance and retail accounts.?

And Mr. Hiscox said he believes, as do many in the industry, that reinsurance pricing will be strong following the spate of hurricanes this year.

Hiscox also thinks there is room for it to step into the Bermuda market, pointing out how badly hit some Bermuda reinsurers were by 2005 hurricane claims. Hiscox was itself hit by hurricane losses in the region of $240 million.

In an investor presentation, Hiscox said examples of the Bermuda ?market dislocation? were Aspen, IPC Re, Montpelier Re and PX Re, with each sustaining significant losses from hurricanes Katrina and Rita ? between 26 percent and 65 percent of June 30 shareholders? equity ? putting each company?s financial strength rating either on a threat for downgrade, or downgraded, by leading ratings firm AM Best.

Ms Langley said Hiscox is targeting an A-rating from AM Best for its Bermuda unit. ?We believe mid-December is a realistic timetable to achieve a rating by,? she said.

Hiscox isn?t the only one out of Lloyd?s seeing opportunities in Bermuda. Two other Lloyd?s insurers ? giant Amlin and smaller outfit Omega ? are also planning moves into the Bermuda market. And another of the new start-ups, Lancashire, is currently being formed by a veteran of the London market, Richard Brindle.

Wellington Underwriting said last week that it could also establish a Bermuda operation. Wellington has had close ties, including founding investments, in two ?Class of 2001? Bermuda reinsurers ? Aspen Holdings and Montpelier Re.

The new Bermuda insurers already known to be licensed by the BMA as Class four companies ? indicating capitalisation greater than $100 million ? are: Amlin, Ariel, Arrow, Flagstone, Hiscox, Harbor Point, Lancashire, New Castle and Validus. Together the new companies are expected to have initial capitalisation in the region of $8.5 billion.