industrial action has been reorganised to meet new European Union regulations.

The Bermuda-based Strike Club will lose about ten percent in premium income and will see a decline in policyholders of the company as a result of the formation of a new Luxembourg-based affiliate.

Mr. Bill Milligan, CEO of Strike Club Management Ltd., said yesterday the club has been split into two companies and a new reinsurance company is being formed which will service both firms.

The changes were official February 1, 1995, The new Strike Club structure includes The Shipowners' Mutual Strike Insurance Association (Bermuda) Ltd., to write non-European risks, The Shipowners' Mutual Strike Insurance Association Europe, to be based in Luxembourg to write European risks, and the Bermuda reinsurer, The Shipowners' Mutual Strike Reinsurance Association (Bermuda) Ltd.

Established in 1957, the Strike Club, with offices in the Commerce Building, Chancery Lane, is a mutual insurer of shipowners, charterers and operators, covering daily running costs of vessels if they are delayed by strikes or withdrawal of labour.

The restructuring stems from a new European insurance license regulation requiring insurers to obtain one licence for European clients instead of one for each country.

The Strike Club will access the European Economic Area (EEA), which includes the 15 members of the European Union (EU) as well as Iceland and Norway, through a new licence given to the new Luxembourg company.

To comply with the European licensing requirement, "we have had to take the company apart and then put it back together,'' Mr. Milligan said.

The Bermuda company's premium income may decline but the newly-formed Strike Club's new Bermuda reinsurance company, will retain 90 percent of premiums written out of Bermuda and Luxembourg through reinsurance premiums, Mr.

Milligan noted.

The Bermuda reinsurer will also retain accumulated reserves.

"Following a review of the regulatory and operational environment in which the Strike Club operates, and particularly in view of implementation of the EU's Third Non-Life Insurance Directive in 1994, the board, the managers and their advisors believe they now have a structure that is sufficiently flexible to capitalise on the advantages of the mutual system, preserve the unity and interests of members and serve the club's needs for the foreseeable future,'' Mr. Milligan added.

Other Bermuda companies may have taken, or are considering, a similar route, according to Mr. Milligan.

"We have taken the lead and others may follow,'' he said.

The Bermuda and Luxembourg companies will adopt a common policy for levying and rating calls, and premiums, and for dealing with claims.

"Directors believe that the restructuring is essential to guarantee compliance with regulatory requirements and that this proposal achieves such compliance while at the same time preserving the unity of the membership and the present operation to the extend possible,'' said Chairman Mr. Clive Roberts, in a circular distributed earlier to club members.

The restructuring has been approved for a five-year period unless terminated earlier by a unanimous agreement of the Bermuda reinsurer, the Bermuda insurer and the Europe insurer based in Luxembourg.

Members of the Strike Club approved the new structure in Switzerland at a special general meeting on January 27.

The Bermuda insurance mutual company will be managed by Bermuda company Strike Club Management Ltd. while the European company will be managed by Luxembourg-based Strike Club Management (Europe).

Membership in either the Bermuda or Luxembourg club will depend on the location of the member concerned.

With no conventional parent/subsidiary relationship within the group, combined accounts will be presented to members showing the overall financial position of the Strike Club.

Annual reports will be largely unchanged.

Seashore Mutual Insurance (Bermuda) Ltd. was an interim name given to the Bermuda insurer until the members approved the restructuring.