Devastation in the Cayman Islands from powerful Hurricane Ivan last week could leave a financial mark on Bermuda shores, with several local companies having stakes in insurance firms operating in the Caribbean financial centre.

Ivan smashed into the Caymans, a low-lying chain of several islands, on September 12, with winds of up to 150 mph. The storm is estimated to have caused more than $1 billion in property damage.

Early assessments predict that damage in the Caymans will account for a significant portion of total Caribbean damage from the storm, which is estimated at about $2 billion. About a fifth of homes on Grand Cayman, the largest of three Cayman Islands and home to 43,000 people, were destroyed by the hurricane.

The level of expected claims has prompted some speculation that the island?s domestic insurers might have to seek cash injections from investors, but ratings agency AM Best said it was too early to say whether this would be necessary.

Yesterday one Bermuda firm that has a significant stake in a Caymans insurer said it was too early to give an estimate of claims from the event, but said reinsurance protection was expected to be adequate. Another said it had not been approached for financial assistance.

Colonial Insurance president and CEO Alan Peacock said the company was a 40 percent stakeholder of British Caymanian, which holds 27 percent market share for property insurance in the Cayman Islands. The company also writes health insurance.

Mr. Peacock said British Caymanian ? which was starting to get back to business yesterday with its Georgetown office getting electricity restored for the first time since the storm ? should have adequate reinsurance coverage for claims.

Although claims were not expected to exceed reinsurance, two teams from Colonial ? one of insurance professionals and a second of engineers ? arrived last Thursday to help in assessing damage. The insurance team includes Colonial?s head of property insurance in Bermuda, Peter Oliver.

Mr. Peacock said: ?We are taking a very good look. I would say that a lot of the structures withstood the storm. We will have inundation claims as there was a lot of flooding, especially in low-lying areas, but we are not in a position to completely estimate what claims will be.?

He added that Colonial had business interests throughout the Caribbean, but was not yet able to give any idea of the group?s total exposure to damage from three hurricanes ? Charley, Frances and Ivan ? that have swept through the region this season.

Bermuda?s oldest bank, Butterfield Bank, through Butterfield Holdings has a 25 percent stake in another Cayman insurer, Island Heritage.

Yesterday a Butterfield spokesperson said: ?There has been no approach from the company for financial support.? Butterfield is also a leading financial institution in the Cayman Islands. Last week CEO Alan Thompson said: ?We have been closely monitoring Hurricane Ivan, and from a business perspective we were prepared.?

The bank?s head office in the Caymans did lose part of its roof in the storm.

Another Bermuda-based company, Arch Capital, also holds a significant stake in Island Heritage.

AM Best senior financial analyst Nelson Rivera yesterday said it was too early to say whether the Caymans? major domestic insurers ? Island Heritage Insurance, British Caymanian Insurance and Cayman General Insurance ? would need cash injections from stakeholders to meet claims from Ivan.

?At this point it is undetermined. We have very limited information; at the moment only cell phones seem to be working.?

Mr. Rivera told that ratings for the Cayman insurance companies were currently under review with negative implications, indicating the strong possibility that financial strength ratings could be downgraded.

?There?s a big question mark over these companies because this is such an unprecedented event for the Cayman Islands,? Mr. Rivera said, calling Ivan?s hit a 1-in-1,000 year event. Ivan may have caused as much as $2 billion in insured losses in the Caribbean, with about two-thirds of that in the Cayman Islands, modeling firm Risk Management Solutions said last week.