any direct action by the US Government, especially now that the control of the Congress has switched from Democratic to Republican.

American International Company Ltd. counsel Mr. Michael Murphy said yesterday he was convinced that not much other than bad publicity would have resulted even if the Democrats hadn't been swept from office last Tuesday.

"Wishful Thinking: A world View of Insurance Solvency Regulation'', the report from the subcommittee on oversight and investigations of the Committee on Energy and Commerce in the House of Representatives, chaired by Rep. John Dingell, was released last month.

When asked to comment on the report since the change in the make-up of Congress, Mr. Murphy said: ,"The Dingell report becomes significantly less relevant as a result of the changes in Congress.

"However, it was unlikely that the Dingell report would have led to significant (legislative) changes if the Democrats stayed in, unless there was another failure of a major insurer within the United States.'' The Dingell report's criticisms of the Bermuda market were dismissed yesterday by the chairman of the Insurance Advisory Committee, Mr. Brian Hall, during an address to the Bermuda Market Briefing.

In an off-the-cuff remark at the end of a speech on captive formations, the Johnson & Higgins (J&H) director and J&H (Bermuda) Ltd. chairman said: "It is unreasonable for any market to be condemned for the state of one company (Bermuda Fire & Marine in provisional liquidation) in the market. As you've heard there are already 1,350 insurance companies in Bermuda.'' Mr. Hall made it clear that he was unable to fully comment because the case was in the hands of the courts.

But he said: "The courts are at the disposal of the creditors and I firmly believe that the company is in the competent and capable hands of the provisional liquidators who are doing a masterful job in keeping the public informed, as and when they are in a position to do so.'' Mr. Hall reinforced the position taken earlier in the day by his former boss, Mr. Richard Meyer, retired executive vice president of J&H, that Bermuda Fire & Marine's problems were caused by London underwriting agencies that were regulated by the Department of Trade and Industry.

But another issue for the Dingell report was one of confidentiality and the restriction on information to the public.

Mr. Hall said: "For the US regulators to point at any Bermuda insurance or reinsurance company and question whether it is doing anything in an area of secrecy, is in itself questionable.

"Every US-owned insurance company in Bermuda, whether it is a publicly-owned company or a privately-owned company, really makes no secret of the way it does business.

"Clearly, a Mid-Ocean Re, ACE and EXEL and others produce public information.

They have to do that purely to generate a market response. Likewise the individual privately-owned or company-owned captives also file tax returns and make some returns to their parent corporations in support of their operations, and their responsibilities to the United States.

"So for the US corporations that own insurance companies in Bermuda, I don't believe that secrecy is a big concern. We also, under our US-Bermuda Tax Treaty, have an exchange of information provision in which regulators could certainly seek to use that resource,'' he said.

"Bermuda, at the present moment, does contain in its Insurance Act a confidentiality provision. And at the present moment because of the nature and breadth of the market as it relates to US as well as non-US interests that are here, we are not in a position to change the confidentiality provision.

"Time will tell whether, in fact, we will make some changes.''