Harbor Point, the biggest and most highly rated new Bermuda reinsurer, has sufficient capital to become a ?substantial, recognised? name in the market, chief executive John Berger says, but growth isn?t the company?s ultimate goal.

?I don?t know if we are going to get bigger: Premium size or growth are not our goals,? said Mr. Berger, now eight weeks into serving as president and CEO of the new $1.5 billion venture.

Harbor Point is one of ten new insurance and reinsurance companies that entered the Bermuda market late last year with combined capital nearing $10 billion. A wave of incorporation activity ? the so-called ?Class of 2005 ? followed Hurricane Katrina, the August 29 storm that hit the Gulf Coast leaving insurers to pick up a bill for as much as $60 billion in damage costs.

Harbor Point already has more than 50 staff ? comprised of 42 staff transferred over to the new company from Chubb Re, and five hires made in the weeks since.

Ten staff are based in the Bermuda office, while the rest of the employees are in Bernardsville, New Jersey, where Chubb Re was based. Mr. Berger predicts staffing could rise in the Bermuda office to 25 by year-end.

For now the company is sharing office space with Chubb Atlantic Indemnity, a Bermuda Chubb subsidiary, in the Belvedere Building on Pitts Bay Road. Mr. Berger said Harbor Point will move to its own space as it grows.

Although considered a member of the ?Class of 2005?, Harbor Point, in pure terms, isn?t really a start-up, Mr. Berger said.

Warren, New Jersey-based Chubb Corp., which sells a range of insurance products including being the leading seller of insurance to I.T. companies, and Trident III LP, a private equity fund managed by Stone Capital LLC, announced on October 25 they were to form Harbor Point, as Chubb exited the reinsurance business.

Mr. Berger credits Harbor Point?s agreement with Chubb for its ability to quickly win top ratings from A.M. Best and Standard & Poor?s. Under the Chubb deal, the Bermuda reinsurer has the right to renew policies sold previously by Chubb Re but without being exposed to any liabilities arising from old policies.

Harbor Point was last year assigned an ?A? financial strength rating by A.M. Best while other ?Class of 2005? companies were rated the lower ?A-?. Last week the company became the third new reinsurer, after Hiscox and Amlin, to be rated, being assigned an ?A-? by Standard & Poor?s. Hiscox and Amlin?s ratings have also been quick off the blocks to win ratings based on the strength of their parent companies, both leading companies in the Lloyd?s of London market.

Insurers weighing which reinsurer to buy coverage from put a lot of stock in ratings from A.M. Best and S&P, agencies that measure the financial strength and flexibility of companies in the sector.

Harbor Point?s ?A-? rating reflects the company?s strong competitive position and a proven management track record at Chubb Re, S&P said last week.

Harbor Point will sell casualty reinsurance, largely through its renewal agreement with Chubb, and is ramping up participation in the property market, an area it largely shied away from when Chubb Re.

?Harbor Point has some unique advantages compared with other competitors in 2005, including offering ?AA? financial strength to cedants for up to one year for property risks and up to two years for casualty treaties via a fronting arrangement with Federal Insurance Co. (Federal), a subsidiary of Chubb,? S&P said.

?These positive factors are offset by the limited track record in property catastrophe business due to its parent?s (Chubb Corp.?s) lack of appetite for additional property exposure,? S&P credit analyst James Brender said.

Chubb, which holds a 16 percent stake in Harbor Point, is to receive payments over the next two years from the Bermuda reinsurer based on the amount of reinsurance business that flows through Chubb to Harbor.

The company, which was ranked amongst the world?s 500 biggest companies in a 2004 FT survey that tracked market capitalisation, said on January 31 it has already benefited from the Harbor Point transaction. Fourth quarter profit rose to $614.4 million on a $171 million gain from moving over most of its reinsurance business, Chubb said.

A.M. Best said it was also basing its high rating on the reinsurer?s relationship with Chubb, a highly-rated insurer, as well as on the merits of Mr. Berger, a 28-year industry veteran, who was instrumental to Chubb Re?s formation in 1998. At the time, then Chubb chief executive Dean O?Hare praised Mr. Berger as ?one of the top people in his field?.

?Harbor Point?s strengths are partially offset by increased competition and new capacity brought to market from both established and newly created companies,? cautioned Best. ?This additional capacity could dampen expected returns if pricing of reinsurance coverage fails to meet anticipated levels.?

Mr. Berger concedes that rates, in some areas, aren?t as high as they need to be. But he, along with a number of his ?Class of 2005? peers, expects rates to continue to rise through 2006.

He said the market has not yet priced in the ?full impact? of higher capital requirements from ratings agencies, or the revamp of catastrophe models after Hurricane Katrina.

?We could see some tightening,? he said, making this an unusual year since January 1 renewals ? a pivotal business period that generally sets market rates for the year ? didn?t necessarily paint a picture of pricing for the rest of the year.