Bermuda insurance bosses say it is too early to put any real stock in a class action reform measure passed by the US Senate last week and now on its way to the House of Representatives.

The legislation on the table is also unlikely to free up the billions that have been reserved by companies because of the escalating pricetag of awards in these types of cases, it was said this week.

Congress was expected to consider class action reform ? with the Class Action Fairness Act already securing bipartisan majority support a week ago ? as early as this week. The law could then be on its way to President George Bush for his binding signature. If enacted, the class action legislation ? which was the first bill to come to the Senate floor this year ? could shift class action cases seeking $5 million and up out of state courts into less friendly federal ones.

The insurance industry ? including Bermuda-based firms ? have been lobbying in support of this kind of reform for years.

However, while the legislation could lower the number of ?frivolous? lawsuits and lead to more moderate judgments, it may not enable insurers to reduce the level of funds set aside for cases already before the courts .

Bermuda-based insurance giants ACE Limited and XL Capital have both had to shore up reserves to the tune of billions of dollars in recent years for prior business written in the US. ACE has moved to increase its reserves after mounting asbestos awards ? liabilities inherited through its 1999 acquisition of Cigna?s P&C business ? while XL has been forced to boost its reserves on the back of what CEO Brian O?Hara called ?marked expansion of liability in the US tort system?.

Mr. O?Hara, who was taking part in the Merrill Lynch Insurance Investors Conference in New York this week,? said the Senate class action reform could be good for casualty insurance premium rates. ?We need tort reform in other areas, but that is a good start,? he said.

Meanwhile, ACE CEO Evan Greenberg ? also speaking at the Merrill Lynch event ? said class action reforms on the table would not have an affect on reserves, or funds set aside for claims from prior years.

?Class action reform is for cases filed subsequent to the passing of the law,? he said, adding: ?It is still to early to tell what (reform) will do on pricing. We are not putting on a class action discount.?

He concluded: ?The trial bar is very clever and our system very complex; our pricing will reflect experience.?

Critics of the tort reform measures ? led by class-action lawyers and consumer groups ? have slammed Mr. Bush?s ardent support of this kind of legal reform as little more than a way for him to give back to ?big business? for standing by him through two elections.