MUNICH (Bloomberg) - Hannover Re, Germany’s second-biggest reinsurer, has established a life reinsurance unit in Bermuda to do more international business and pay lower taxes.

The new subsidiary has an equity base of 120 million euros ($170.6 million), the Hanover, Germany-based reinsurer said in a statement distributed by the Hugin newswire yesterday. It is forecast to have gross premiums of at least 100 million euros next year, Hannover Re spokeswoman Christine Harms said in a telephone interview today.

“Hannover Life Reassurance Bermuda Ltd. is to assume an important position within the life and health reinsurance business group,” Hannover Re CEO Wilhelm Zeller said in the statement.

Zeller is stepping up sales of life and health reinsurance to limit profit swings from natural disasters such as hurricanes. As part of that strategy, Hannover Re is looking to make acquisitions in that segment, it has said.

Bermuda has used a low tax rate and lighter regulation to attract insurance business from Europe. Hannover Re’s new unit will concentrate on the UK, Ireland, Canada, South Africa as well as on business from various Asian markets, Ms. Harms said.