It has been an impressive start to the year for Bermuda's insurance and reinsurance market with a combined profit of $3.3 billion amassed by two dozen key companies.

In only three months those 24 companies have made more money than the full-year gross domestic product of individual countries such as Cayman Islands, Belize, the US Virgin Islands and the European principality of Andorra.

A Royal Gazette snapshot of key insurance and reinsurance companies reveals they made a combined average profit of $1.1bn each month between January and March.

The benign catastrophe season of 2006 and a relatively quiet opening quarter of 2007, with only European Windstorm Kyrill making any notable dent in the financial bottom line of reinsurers, has left most companies with enough capital reserves to launch sizeable share re-purchase schemes in order to preserve shareholder value in a tightening premium writing market.

During the first three months Bermuda's two heavyweights Ace and XL Capital streaked ahead of the pack with net incomes of $701m and $549.7m respectively.

Ace's performance was a 43 percent improvement year-on-year, while XL bumped up their first quarter figure by just over $90m compared to the same period in 2006. Further down the list there were strong debut appearances by newcomers Flagstone Re and CastlePoint, flushed with successful initial public offerings and yet to be tested by a full-bodied catastrophe season.

RAM Holdings more than doubled its profits year-on-year with a 114 percent jump to $14.3m, while Aspen was close behind in terms of performance as its profit increased 97 percent.

It wasn't all rosy though. Platinum saw profits dip $4.2m due to a "mild softening" of the catastrophe reinsurance market and a greater focus on excess-of-loss business.

Only one of the 24 companies made a loss and that was PXRE. The company is now in the process of merging with US giant Argonaut Group and stopped underwriting in the later half of 2006 after encountering heavy losses as a result of hurricanes Katrina, Rita and Wilma in the US in 2005. PXRE ended with a first quarter loss of $7.1m, but is re-adjusting and its underwriters are now gathering business for the all-new Argonaut/PXRE vehicle Peleus Re.

The three-month profit of these two dozen Bermuda reinsurance market companies, at $3.298bn, outstrips the full year gross national product of Belize (measured at $2.3bn in 2006), Cayman Islands ($1.9bn in 2004), US Virgin Islands ($1.57bn in 2004) and Andorra ($2.77bn in 2005).

It is in line with the performance of the 16 biggest Bermuda reinsurance market companies who made a combined full year profit of $11.6bn in 2006.

The bumper year of 2006 went a long way to replenish the losses suffered in the hurricane-intense years of 2004 and 2005, and many reinsurance companies have now embarked on sizeable share re-purchase programmes with their capital reserves.

XL and Arch have announced intentions to repurchase up to $1bn of their respective shares, and similar large-scale buybacks have been authorised by others, including IPC, Endurance and Everest Re.

In tomorrow'sRoyal Gazette find out who the top executives behind these remarkable company performances are and discover what individual rewards they receive in terms of salaries, bonuses and other perks.