XL Capital yesterday announced its reinsurance business had been been granted a so-called "single passport" to sell reinsurance throughout the European Union and will operate the business out of Dublin.

XL said it had received approval for a new fully licensed European reinsurance company, XL Re Europe Ltd., based in Dublin, which will be XL's European reinsurance platform.

XL Re Europe has been established with $1.5 billion of capital and surplus, and said ratings agency Standard & Poor's had confirmed that it will be rated A+, in line with XL's other reinsurance entities.

XL Re Europe Limited has formed two new branches in the UK and France to facilitate the assumption of business previously underwritten by the UK branch of XL Re Ltd. and XL Re Europe SA, XL said.

The non-life business of the UK branch of XL Re Ltd. will be transferred into XL Re Europe Ltd. on January 1, 2007 under Part VII of the Financial Services & Markets Act 2000. This scheme has been approved by the UK High Court of Justice.

"The business of XL Re Europe SA has been transferred to the new company under the "Transmission Universelle Du Patrimoine" (TUP) process," XL said.

David Watson, previously XL Re Ltd.'s general manager in London, has relocated to Dublin to become president and chif executive of the new company. Bermudian Mark Berry, previously head of XL Re Ltd.'s Special Risks underwriting department, is now general manager in London, reporting to Mr. Watson.

Other senior management, including the chief financial officer and chief underwriting officer, will be based in Dublin, along with underwriting and administrative teams, XL said.

Jamie Veghte, chief executive of XL's reinsurance general operations, said: "We welcome the announcement by Standard & Poor's today that XL Re Europe Ltd. will be rated A+, the same as our other XL Re companies. Our priority is to ensure that our clients will continue to benefit from our financial strength and high ratings.

"We are also very pleased to have our entire European operations under one unified management team led by David Watson. This will ensure consistency in our approach and a seamless delivery of products and services to the market."

XL chief executive Brian O'Hara said earlier this month that the single regulator approach taken in Europe "will serve the EU well" and he called for the US, where insurance and reinsurance are regulated by the 50 different states, to introduce a similar model.

He said that the Dubin company would also have branches in Germany and Spain.

XL Capital also announced yesterday that it had changed the company's financial reporting presentation by expanding its segment reporting to five segments.

The new segment presentation will consist of the insurance, reinsurance, life operations, financial lines and security capital assurance operating segments.

The changes to the reporting segments reflect changes in executive management responsibilities following the initial public offering of Security Capital Assurance Ltd in August 2006. The changes include the re-presentation of the company's former Financial Products and Services segment into the Financial Lines and SCA segments.

These financial reporting changes will take effect beginning with the third quarter 2006 financial results, which will be released next week.